Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2013
 

Sales and Use Tax Annotations


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R

460.0000 REIMBURSEMENT FOR SALES TAX—Regulation 1700

Annotation 460.0242

460.0242 Internet Order Form. An Internet order form invites purchasers to buy merchandise for an amount plus "tax and shipping." The shipping cost is set at a fixed price for sales in California, to which an additional amount is added for sales outside the state, depending on the destination ZIP code. The purchaser is given a lump-sum statement of the total amount due via e-mail or telephone call. In all cases the purchaser pays a final charge that is greater than the printed prices on the order form.

In the absence of a sales invoice or other documentation containing a separately stated charge for tax and shipping, the Internet order form acts as the agreement of sale. The information contained on the order form states that the purchaser will be charged tax and the purchaser is actually charged some additional amount that appears to be sales tax reimbursement. Therefore, it is presumed that both parties agreed to the addition of sales tax reimbursement. Where tax reimbursement was charged, collected and reported on exempt sales to out-of-state customers, this is excess tax reimbursement that can be refunded to the customers from whom it was collected. 1/23/02.