Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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Annotation 335.0003

335.0003 Aircraft Purchased Out-of-State. A person purchases an airplane outside California and enters California in less than ninety days from the date of the delivery of the plane. [See note below.]

(a) It is presumed that the purchase was made for use in California, and use tax applies to the purchase price of the plane unless the use of the plane will be limited to leasing. If so, the use tax liability of the purchaser may be paid measured by the fair rental value of the plane if the purchaser makes a timely election to do so.

A person purchases an airplane outside California and uses it more than ninety days prior to its first entry into California.

(b) The airplane is regarded as not having been purchased for use in California and use tax does not apply. Since the lease of MTE is not a sale pursuant to Revenue and Taxation Code section 6006 (g)(4) but rather is regarded as use by the lessor, and since use tax does not apply to the purchaser's use of the plane in California, use tax also does not apply to the purchaser's lease of the plane. 10/25/89; 5/15/91. (Am. 2006–1; Am. 2008–1).

(Note: For the period October 2, 2004 through June 30, 2007, under certain conditions any vehicle, vessel, or aircraft purchased outside of California and brought into the state within 12 months from the date of its purchase is presumed to be acquired for storage, use, or other consumption in California and subject to use tax.) (Regulation 1620(b)(5).)