Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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425.0000 PRESCRIPTION MEDICINES—Regulation 1591

Annotation 425.0690


425.0690 Oxygen Storage Tank. Rental of a medical oxygen storage tank to a hospital is exempt from tax when the tank is then sold, leased, or rented to an individual for the personal use of that individual as directed by a physician. However, to qualify for this exemption, the transaction between the hospital and the individual must constitute an actual sale, lease, or rental.

Where the patient's use of the storage tanks is limited to the hospital's premises, the direction and control of the equipment never transfers to the patient. Accordingly, there can be no lease or rental of the storage tank to the patient under these conditions. Therefore, the medical oxygen delivery systems exemption under Sales and Use Tax Regulation 1591(m) would not apply to the rental of storage tank to the hospital. 4/8/91.