Ezel / Tax Rulings / CA

When did furnishing and applying asphalt make the applier a construction consumer?

Short answer When lump-sum application converted the product to real property upon application, as with pressure spraying. Dumping rock, sand, or gravel needing later spreading was only delivery.
State
CA
Ruling
Annotation 190.0060
Tax type
Sales and Use Tax
Issued
1953-09-01
Issued by
California State Board of Equalization
Requested by
S--- O--- C--- of C---
Topics
asphalt real property improvements lump sum contracts contractor consumers delivery
Source
View Original PDF

Apply this to your situation

This page answers the general question as of 1953. Ask about yours and see what current California tax law says, with citations.

Currency note: this ruling is from 1953
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This September 1, 1953 Tax Counsel letter distinguishes immediate conversion to real property through application from mere delivery before another party performs final spreading. It specifically treats pressure-sprayed asphalt as construction work and dumped rock, sand, or gravel awaiting later placement as delivery. Current paving products and subcontract scopes require current-law review.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page as a PDF) is the authoritative source for any reliance.
View original ruling (PDF)

Plain-English summary

A person furnishing and applying asphalt or a similar product under a lump-sum contract was the consumer when the application itself improved real property and converted the product to realty.

Pressure spraying asphalt met that test.

Merely dumping rock, sand, or gravel did not. If the material still required spreading before reaching its final resting place, the act was delivery rather than a real-property improvement.

Common questions

Was pressure-sprayed asphalt construction work?

Yes.

Was dumping aggregate at the site construction work?

No, when later spreading was still required.

What distinction controlled?

Whether the application itself converted the product to real property in its final place.

Source

Original ruling text

190.0060

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

September 1, 1953

Mr. W. N--- L--Assistant Excise Tax Counsel
S--- O---C--- of C--S--- O--- Building
--- --- XX, California

X - XXXX

Dear N---:
We confirm our statement to you of August 20 that persons who agree to furnish and apply asphalt or other similar products on a lump-sum basis are considered the consumer of the asphalt or other products, provided the application thereof constitutes the improving of real property. This requires that the goods be applied in such a manner as to convert them to real property upon application. In the case of asphalt and similar products which are applied by pressure spraying, this requirement is complied with. The mere dumping, however, of rock, sand, or gravel, which requires further spreading before the material has reached its final resting place, is regarded as mere delivery and not as improving real property. Very truly yours,

E. H. Stetson
Tax Counsel

EHS:ph
cc:

San Francisco – Tax Administrator

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