Was the 12% federal retailer's excise tax on heavy trucks included in the California sales- or use-tax measure?

Plain-English summary

California examined the 12 percent federal retailer's excise tax on heavy trucks under Internal Revenue Code section 4051 et seq. Because that federal charge was imposed with respect to retail sales, California excluded it from gross receipts subject to sales tax and sales price subject to use tax.

Common questions

Was the federal heavy-truck retail tax included in California gross receipts?

No.

Was it included in sales price for use tax?

No.

Why was it excluded?

The federal charge was imposed on retail sales, not as a manufacturer or importer excise tax.

Citations and references

• Historical Internal Revenue Code section 4051 et seq.
• California Revenue and Taxation Code sections 6011, 6011(c)(4), 6012, 6012(c)(4), 6051, and 6201
• Business Taxes Law Guide Annotation 295.1245
• Representative's November 28, 1988 letter to former Executive Secretary Douglas D. Bell — taxpayer and confirmation request described; full letter not reproduced in the official PDF
• Board examination of the federal retailer's excise tax — conclusion stated; analysis, federal materials reviewed, and examination workpapers not supplied in the official PDF
• Enclosed copy of Business Taxes Law Guide Annotation 295.1245 — identified as enclosed but omitted from the official PDF
• Possible later returns, exclusions, audits, assessments, refund claims, appeals, or other application after the advice — no follow-up or outcome supplied in the official PDF

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: https://cdtfa.ca.gov/lawguides/vol2/suta/235-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/235-0070.pdf

Original ruling text

235.0070

STATE OF CALIFORNIA

1

STATE BOARD OF EQUALIZATION
1020 N STREET, SACRAMENTO, CALIFORNIA
(P.O. BOX 942879, SACRAMENTO, CALIFORNIA 94279-0001)
(916) 445-8485

January 10, 1989
--Dear --:
Your letter of November 28, 1988 to former Executive Secretary Douglas D. Bell has been referred to the undersigned for reply. On behalf of --- (---), you requested that we confirm that the 12% Federal Retailer’s Excise Tax on Heavy Trucks (26 U.S.C. § 4051 et seq.) is excludable from the measure of the California sales and use tax. California sales tax is measured by “gross receipts” while the use tax is measured by “sales price” (Revenue and Taxation Code §§ 6011, 6012, 6051, 6201). “Gross receipts” and “sales price” do not include “… the amount of any tax (not including, however, any manufacturers’ or importers’ excise tax) imposed by the United States upon or with respect to retail sales whether imposed upon the retailer or consumer.” (Revenue and Taxation Code §§ 6012(c)(4), 6011(c)(4)). We have examined the Federal Retailer’s Excise Tax in question and have determined that, since it is imposed with respect to retail sales, it is excludable from the measure of the California sales and use tax (see Business Taxes Law Guide Annotation 295.1245, copy enclosed.) Sincerely, E. L. Sorensen, Jr. Senior Tax Counsel ELS:jb Enclosure