Ezel / Tax Rulings / CA

Were circulars taxable when each product box included directions for that product and advertising for three other products?

Short answer Yes. California found the circulars primarily advertising because each box contained only one product while the circular promoted and described all four.
State
CA
Ruling
Annotation 195.1720
Tax type
Sales and Use Tax
Issued
1954-05-11
Issued by
California State Board of Equalization
Requested by
Redacted cosmetics laboratory
Topics
cosmetics primary purpose sales tax
Source
View Original PDF

Apply this to your situation

This page answers the general question as of 1954. Ask about yours and see what current California tax law says, with citations.

Currency note: this ruling is from 1954
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 May 11, 1954 opinion responds to a March 1 letter whose year and separate copy are not supplied in the official PDF. It describes but does not reproduce the multiproduct circular, and its listed Auditing copy supplies no separate transmittal record. The opinion concerns one circular containing advertising and directions for four named nail-care products, enclosed in boxes holding only one of those products. The conclusion rests on the circular's primary purpose in that packaging context. Actual content, package pairing, consumer need, later authority, and current law control.
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 cosmetics company put the same circular into boxes for four different nail-care products. The circular contained both advertising and directions for using all four products.

Because any one box held only one of the four products, California said the circular necessarily advertised the other three. Counsel treated the circular as primarily advertising and concluded that tax applied to the company's purchase of it.

Common questions

Did the presence of use directions make the circular exempt?

No. Its overall function in each single-product box was primarily advertising.

Would the result necessarily be the same for a product-specific instruction sheet?

The letter did not decide that different fact pattern.

Citations and references

  • Requester's March 1 letter — sales-tax question about circulars enclosed with cosmetics products described; year and separate letter not supplied in the official PDF
  • Multiproduct circular — advertising and directions for four named nail-care products described; edition date and copy not included in the official PDF
  • Copy to a redacted Auditing recipient — copy recipient listed; no separate transmittal record supplied in the official PDF

Source

Original ruling text

195.1720

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

May 11, 1954

T--- Laboratories
XXXX --- Avenue
--- XX, California

Your letter of March 1

Attention: Mr. J. W. M---

Account No. SR -- XX XXXXXX

Gentlemen:
You inquire concerning the application of sales tax to the sale to you of circulars, one of which you enclose in every box of your product. The circular contains both advertising material and directions for use on all four of your products, namely, T--- oily --- Nail Conditioner, T--- Oily Polish Remover, T--- Cuticle Remover, and T--- Cuticle Remover with Self-Feeding Cuticle Shaper. However, the circular is enclosed in a box which contains only one of these four products and in any given case is clearly advertising as to the other three. It is our opinion that the circular is primarily advertising and is therefore used by you. Accordingly, the tax applies to the sale to you of these circulars. Very truly yours,

Bill Holden
Assistant Counsel

BH:ja
cc:

--- --- - Auditing

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