Was aloe vera gel exempt when it was consumed as a beverage and not labeled as a dietary supplement?

Plain-English summary

The reviewed product consisted of 99.55% aloe vera, 0.25% Irish moss, and 0.20% sorbic acid, which the memorandum identified as a food preservative.

The product was not labeled as a dietary supplement. According to the taxpayer, it was used as a beverage.

Under those conditions, Board counsel concluded that the aloe vera gel qualified as an exempt food product under Regulation 1602 and that tax did not apply to its sale.

Common questions

Did the source exempt every aloe vera gel?

No. It addressed the stated composition, beverage use, and absence of dietary-supplement labeling.

What ingredients did the reviewed product contain?

It was 99.55% aloe vera, 0.25% Irish moss, and 0.20% sorbic acid.

What product-use fact mattered?

The taxpayer said the gel was consumed as a beverage.

Citations and references

• California Sales and Use Tax Regulation 1602 (as cited)
• Return Review staff member S. L. Shaver's June 16, 1989 memorandum requesting aloe-vera-gel advice — referenced; not reproduced in the official PDF
• Referenced taxpayer's aloe vera gel consisting of 99.55 percent aloe vera, 0.25 percent Irish moss, and 0.20 percent sorbic acid, with beverage use and no dietary-supplement label — facts stated; taxpayer submission, formula specifications, label, package, sample, preservative evidence, beverage-use records, invoices, and sales records 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/245-1119.pdf

Original ruling text

State of California

Board of Equalization

Memorandum
To:

Ms. S. L. Shaver
Return Review

From:

Mary C. Armstrong
Legal

Subject:

Aloe Vera Gel

245.1119
Date:

August 21, 1989

This is in response to your memorandum of June 16, 1989 in which you asked our advice regarding the correct application of tax to aloe vera gel sold by the referenced taxpayer. In this case the aloe vera gel consists of 99.55% aloe vera, .25% Irish moss and .20% sorbic acid (a food preservative). It is not labeled as a dietary supplement. According to the taxpayer it is used as a beverage. As such, it qualifies as an exempt food product under Sales and Use Tax Regulation 1602 and tax does not apply to the sale. If you have further questions concerning this matter, we will be happy to discuss them with you.

MCA:wak