Could flavoring and preservative ingredients be bought tax-free for use in exempt animal feed?

Plain-English summary

Ingredients that increased solubility, enhanced or masked flavor, inhibited bacteria or fungi, suppressed oxygen formation, or treated out-of-condition feed could be purchased without tax when they became component parts of exempt animal feed.

The letter listed Cattle Lure, Molasses Intensifier, Standard Flavors, Stock Charm, Kem-wet, End-ox, Mold Curb, and Fat Mask as examples. The result depended on the finished feed: an ingredient incorporated into nonexempt feed was taxable. Dog Lure used in the described pet food was the letter's nonexempt example.

Citations and references

• California State Board of Equalization Ruling 47 (as cited)
• California State Board of Equalization Bulletin 61-27 (as cited)

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: https://cdtfa.ca.gov/lawguides/vol2/suta/110-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/110-0680.pdf

Original ruling text

110.0680

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

May 31, 1966
P--- R. P---, Inc.
--- XX, --- ----- ---, CA XXXXX
Attention:

Mr. J--- L. S--Director of Research

SR -- XX XXXXXX

Gentlemen:
This is in reply to your letter of May 19, 1966, regarding products to be mixed with animal feed to enhance the flavor of the feed or to mask undesirable flavors or odors. The products in this catalogue which increase soluability, enhance the flavor, inhibit the growth of bacteria and fungi, surpress oxygen formation, or treat out-of-condition feed become the component parts of the feed. When the feeds are exempt, the constituent materials may be purchased without tax. This will include items similar to those noted in your catalogue, such as cattel lure, molasses intensifier, standard flavors, stock charm, kem-wet, end-ox, mold curb, and fat mask. Note that these items may become part of feed which is not exempt and, in that case, their retail sale would be taxable. Dog lure as part of pet food is such a product because dogs are not a form of animal life the products of which ordinarily constitute food for human consumption or are to be sold in the regular course of business. For your ready reference, we are enclosing copies of ruling 47 and bulletin 61-27. If you have any further questions, please do not hesitate to write to us again. You are always welcome, of course, to write or call our district office in your area. Very truly yours,

Philip R. Dougherty
Associate Tax Counsel

PRD:md
Encl.
cc:
--- --- District – District Administrator
--- --- – Subdistrict Administrator