Was federal excise tax on photographic apparatus included in California gross receipts and sales price?

Plain-English summary

California classified the federal excise tax on photographic apparatus under historical Internal Revenue Code section 3406(a)(4) as a manufacturer's excise tax.

The federal charge was therefore included in gross receipts subject to sales tax or sales price subject to use tax. In the example submitted, California said the tax measure was $750.

Common questions

Was the federal photographic-apparatus tax excluded?

No.

Why was it included?

It was a manufacturer's excise tax.

What measure did the opinion use in its example?

$750.

Citations and references

• Historical Internal Revenue Code § 3406(a)(4)
• Historical Sales and Use Tax Ruling 57, second paragraph
• Requester's October 17, 1950 letter, including a numerical example with a $750 tax measure — question, Ruling 57 reference, and result described; full letter and computation not reproduced in the official PDF
• Unidentified "various tax services" reviewed to classify the photographic-apparatus charge — no publisher, title, edition, date, page, or quoted text supplied in the official PDF
• Board review of Internal Revenue Code section 3406(a)(4), the tax services, and Ruling 57 — conclusion stated; review notes, workpapers, full federal text, tax-service materials, and Ruling 57 not reproduced in the official PDF
• Photographic-apparatus sale or use transaction, federal tax, gross receipts or sales price, and $750 example — transaction and result referenced; underlying contract, invoice, property, tax computation, payment, and return records not reproduced in the official PDF
• Possible later return treatment, audit, assessment, refund claim, appeal, or other outcome after the advice — no follow-up or final 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/235-0140.pdf

Original ruling text

235.0140

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

October 24, 1950
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Gentlemen:
This is in answer to your letter of October 17 with respect to the application of the California sales and use tax to the amount of the federal excise tax on photographic apparatus, imposed by Section 3406 (a) (4) of the Internal Revenue Code. A review of Section 3406 (a) (4) of the Internal Revenue Code, and of the various tax services indicates that the federal excise tax on photographic apparatus is a manufacturer's excise tax, within the meaning of the second paragraph of Sales and Use Tax Ruling 57, referred to in your letter. Accordingly, the "gross receipts" or "sales price," as the case may be, subject to the sales or use tax, includes the amount of federal tax. In the example outlined in your letter the measure of the tax would be $750.00. Very truly yours, R. G. HAMLIN Associate Tax Counsel RGH:HB cc:

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