Was Soyamel exempt when used as an independent food in a regular diet or as a dairy-milk substitute?

Plain-English summary

Board counsel reviewed the submitted Soyamel label and the information in the request.

Soyamel was used as an independent food item, either as part of a regular diet or as a substitute for dairy milk for health reasons.

Because it was food in its own right rather than a dietary supplement or adjunct, its sales were exempt.

Common questions

Did use for health reasons make Soyamel taxable?

No. The source still treated it as an independent dairy-milk substitute.

What distinguished Soyamel from a supplement?

It was consumed as food in its own right as part of a regular diet.

Did the letter provide a detailed ingredient analysis?

No. The conclusion rested on the submitted label and stated use.

Citations and references

• California Sales and Use Tax Law — food-product exemption applied without a section number
• Redacted seller's letter to Mr. Marks of the Hollywood office requesting the tax status of Soyamel — date and copy not provided in the official PDF; referral to the Board's legal office stated
• Submitted Soyamel product label and request information concerning its independent-food, regular-diet, dairy-milk-substitute, health, supplement, and adjunct uses — described; label copy, formula, ingredient specifications, package, sample, health or use evidence, invoices, and sales records not reproduced in the official PDF
• Blind copies to the Los Angeles District Principal Auditor, Hollywood Subdistrict Administrator, Headquarters Evaluation and Planning, and H. A. Dickson — copy list printed; copies and any follow-up not reproduced in the official PDF
• Possible later product sale, audit, assessment, refund claim, appeal, or other agency action — 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/245-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/245-1060.pdf

Original ruling text

245.1060

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

April 14, 1969

[X]

Dear Mr. [X]:
Your letter to Mr. Marks of our Hollywood office has been referred to the board’s legal office for reply. We have reviewed the label submitted and the information in your letter and have concluded that the product is an exempt food product. This conclusion is based on the fact that Soyamel is an independent food item, used by many as part of a regular diet or as a substitute for dairy milk for health reasons, rather than a dietary supplement or adjunct. Accordingly, sales of Soyamel are not subject to tax under the Sales and Use Tax Law. Very truly yours,

Lawrence A. Augusta
Assistant Counsel
LAA:ph
bc:

Los Angeles District – District Principal Auditor (JTQ)
Hollywood – Subdistrict Administrator
Headquarters – Evaluation and Planning (RN)
Mr. H. A. Dickson