Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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347.0000 MANUFACTURING EQUIPMENT—Regulation 1525.2

Annotation 347.0865

347.0865 Refunds for Manufacturing Partial Exemption. In June 1993, a manufacturing company ordered equipment necessary to begin a new manufacturing business in California. Some of the equipment arrived in December 1993 and was placed in operation in January 1994. The Company applied for the manufacturer's partial exemption and at the same time requested a refund for tax paid on its purchases of equipment from the first quarter 1994 to the first quarter 1997.

Acquiring operating assets necessary to start the business is considered "commencing activities." (See Regulation 1525.2 (c)(6)(A) 1.) The partial exemption from sales and use tax for purchases of manufacturing equipment under section 6377 was operative January 1, 1994. Because the Company commenced activities in 1993, it does not qualify for the partial exemption and is not entitled to a claim for refund for tax or tax reimbursement paid based on the partial exemption. 1/23/01. (2002–1).