Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2013
Sales and Use Tax Annotations
(e) RETAIL SALE OR SALE FOR RESALE—DELIVERY BY OWNER, FORMER OWNER, FACTOR OR AGENT
495.0960 Supplies for Crew—Purchasing as Agent Rather than for Resale. The application of sales tax to the sale of beer, wine, and other non-food items for consumption by crews of fishing vessels while at sea, is as follows: On a typical fishing vessel the crew consists of the three owners and nine hired crewmen. The total grocery expense for food and other items consumed by the twelve men while at sea is divided by twelve. This amount is then charged against each man's share from the voyage. Each man pays the same amount without regard to the value or cost price of items actually consumed by him.
The owners of the boat should not be regarded as reselling these items to the members of the crew. The transaction appears instead to be analogous to a situation whereby A, B and C are going on a picnic and they agree that A will buy the beer and that B and C will each pay A one-third of the cost of the beer. In such case A is acting as agent for B and C in purchasing this beer for them and A is not regarded as selling the beer to B and C. Accordingly, the sale of nonfood items to the owners of the fishing vessel is a taxable retail sale and not sale for the purpose of resale. 9/5/52.