Ezel / Tax Rulings / CA

Which capsule-form herbal products in the letter qualified as exempt unusual foods?

Short answer Twenty-seven listed products qualified as nontaxable unusual foods, but three Spirulina or Lifeforce Junior products were taxable because their labels called them food supplements.
State
CA
Ruling
Annotation 245.1616
Tax type
Sales and Use Tax
Issued
1984-02-16
Issued by
California State Board of Equalization
Requested by
A redacted seller of capsule-form herb products
Topics
herbal products capsules unusual foods food supplements regulation 1602
Source
View Original PDF

Apply this to your situation

This page answers the general question as of 1984. Ask about yours and see what current California tax law says, with citations.

Currency note: this ruling is from 1984
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 February 16, 1984 staff letter classified specifically listed capsule products; it is not another taxpayer's ruling. The PDF references but does not reproduce the December 17 and January 30 requests, product labels, catalogs, ingredients, formulations, manufacturer records, invoices, or sales records. It contains unmatched parentheses in several item numbers and prints 'Natures Pantry,' Skin Kare, Sod/Ginseng, Herb Kal, Arth-Ry-Tus item 804-30, and Arth-Ry-Tus Pain. The current annotation instead uses title language not visible in the PDF and prints Natural, Skin Care, Sod Ginseng, Herbal Kal, item 803-30, and Arth-Ry-Tus Pan without explaining the changes. The PDF reports no later sale, label or formulation change, audit, assessment, refund claim, appeal, or other outcome. Twenty-seven products were treated as unusual foods and three labeled food supplements as taxable. Current ingredients, forms, labels, product identities, documentation, transactions, and 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

Twenty-seven specifically listed herb and herbal capsule products qualified as nontaxable “unusual foods” under Regulation 1602. Their sale or use was therefore not subject to tax.

Three other products were taxable: 079 Spirulina, 077 Spirulina Ginseng, and 026 Lifeforce Junior. Each was described on its label as a “food supplement,” which put it within Regulation 1602(a)(5)(A)'s exclusion for capsule-form products carrying that description.

The distinction came from the labels and the products specifically reviewed, not from a blanket rule that every herbal capsule was exempt or taxable.

Common questions

Did capsule form automatically make the herbs taxable?

No. The letter treated 27 capsule products as exempt unusual foods.

Why were the three named products taxable?

Their labels described them as food supplements.

What products were in the taxable group?

079 Spirulina, 077 Spirulina Ginseng, and 026 Lifeforce Junior.

Citations and references

  • California Sales and Use Tax Regulation 1602 (including subdivision (a)(5)(A)) — food-product classification and label-based capsule exclusion applied in the letter
  • Redacted seller's December 17, 1983 and January 30, 1984 letters requesting an opinion on capsule-form herb and herbal products — letters referenced but not reproduced in the official PDF
  • Herbs and Herbal Products and source-printed Natures Pantry Herb Products product lines manufactured by a redacted producer — product-line names supplied; catalogs, labels, packages, and manufacturer records not reproduced in the official PDF
  • Twenty-seven source-listed exempt products with item numbers and three taxable products described as food supplements — names, item numbers, and outcomes supplied; complete labels, catalogs, ingredients, formulations, nutrition data, directions, packages, samples, tests, invoices, and sales records not reproduced in the official PDF
  • Official Annotation 245.1616's product list and title differences from the PDF, including Onion International Iris title language, Natural/Natures, Skin Care/Skin Kare, Sod Ginseng/Sod-Ginseng, Herbal Kal/Herb Kal, Arth-Ry-Tus item 803/804, and Arth-Ry-Tus Pan/Pain — annotation does not explain the normalization, corrections, or source records
  • Possible later product sale, label or formulation change, audit, assessment, refund claim, appeal, or other agency action — no follow-up or final outcome supplied in the official PDF

Source

Original ruling text

245.1616

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION
916/445-6493

February 16, 1984

Ms. [V]
XXXX --- ----- ---, CA XXXXX
Dear Ms. [V]:
This is in reply to your letters of December 17, 1983 and January 30, 1984 in which you request our opinion as to the correct application of tax to your sale of herb and herbal products, which are sold in capsule form. These items are produced by [O]. In our view, the various [O] products known as “Herbs and Herbal Products” and “Natures Pantry Herb Products” which are listed below are all unusual foods and qualify as food products for human consumption under Sales and Use Tax Regulation 1602. As such, tax does not apply to the sale or use of the following products: Super Energy (Item #201-30) Natural Energy Plus (Item #205-30) Kola Nut (Item #202-30) Nature Trim 100 (Item #401-30) Cy-Nus (Item #807-30) FE-30 (Item # 803-30 HRPEZ (Item #810-30) Colon Clenz (Item #811-30 Skin Kare (Item #813-30) CCF (Item #912-60) Lifeforce III B (Item #604-30B) Lifeforce III C (Item #604-30C) Sod/Ginseng (Item #605-30) STRS (Item #606-30)

Beet Powder (Item # 607-60)
Herb Kal (Item #608-60)
Nature Trim 200 (Item #1402-30)
Nature Trim 102 (Item #1403-30
Lifeforce (Item #601-30)
Lifeforce PM (Item #402-30)
Lifeforce III (Item #604-30)
Mead Pak (Item #601-30)
Nature Calm (Item #602-30)
CFY (Item #603-30)
Arth-Ry-Tus (Item #804-30)
AL-R-G (Item #606-60)
Arth-Ry-Tus Pain (Item #805-60)

Sales and Use Tax Regulation 1602(a)(5)(A) provides that the term “food product” does not include any product for human consumption in capsule form “which is described on its package or label as a food supplement.” Because each of the products listed below is described

Ms. [V]

-2-

February 16, 1984
245.1616

on its label as a “food supplement,” it is our opinion that these products do not qualify as exempt food products under Regulation 1602. Therefore, tax applies to the sale or use of: 079 Spirulina 077 Spirulina Ginseng 026 Lifeforce Junior If you have any further questions concerning this matter, please write this office. Very truly yours,

Charles J. Graziano
Tax Counsel
CJG:ba

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