Were gross receipts from gasoline sold for a silver dime measured by the dime's ten-cent face value?

Plain-English summary

A gasoline retailer advertised one gallon for one silver U.S. dime while also posting ordinary prices above $1 per gallon and accepting ordinary legal tender at face value.

The silver dime was not being accepted as ten cents. Like a commodity or numismatic coin, it was traded at a value greatly exceeding face value. Gross receipts therefore equaled the amount that the silver dime commanded in markets specifically dealing in those coins.

For quick audits, counsel allowed the ordinary posted gasoline price as a proxy unless average silver-coin pricing diverged significantly from average non-silver pricing.

Common questions

Did legal-tender status require ten-cent valuation?

No. The transaction itself valued the silver dime for its metal or collectible market rather than its minted face amount.

Did auditors have to track the coin market every day?

Not necessarily. The memorandum permitted using the ordinary posted gasoline price as a shortcut absent significant divergence.

Citations and references

• The memorandum cites no statute, regulation, or case; its conclusion rests on the stated market facts and exchange valuation.

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: https://cdtfa.ca.gov/lawguides/vol2/suta/140-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/140-0004.pdf

Original ruling text

State of California

140.0004

Board of Equalization

Memorandum
To:

Santa Barbara – District Principal Auditor

From:

Philip R. Dougherty

Subject:

Trade or Barter of Silver Coins

Date:

February 14, 1980

Your telephone call and memorandum question the amount of gross receipts from a sale of gasoline for a previously advertised price of one, silver, U.S. dime per gallon. The retailer of gasoline also offers to sell gasoline at the current ordinary prices, which are in excess of $1.00 per gallon. The retailer does not specify any particular type of payment for the ordinary prices and, presumably, will accept any other legal tender at face value. In the situation presented, the silver dimes are not being traded at an agreed value which is equivalent to the agreed values of other, undifferentiated, U.S. coins of the same face amount. Here, as in the commodity coin and numismatic coin markets, the silver dimes are traded at a value greatly in excess of the value commanded by their legal tender, or “face” value. So the gross receipts from the sale of gasoline for the advertised price of one, silver, U.S. dime per gallon is the amount which that dime commands in other markets which specifically deal in silver dimes. Since you may find it difficult to keep track of fluctuating values of U.S. silver dimes from day to day, for quick audit purposes you may assume that the value of the silver dimes traded for gasoline to be equivalent to the ordinary prices posted for that type of gasoline, unless it becomes apparent that the average value of the “silver” prices diverges significantly from the average “nonsilver” prices. If you have specific audit problems, please call me at ATSS 485-2705.

PRD:ba