Ezel / Tax Rulings / CA

Did a chassis-lubrication shop consume the lubricant included in a lump-sum service charge?

Short answer Yes, if it made no separate lubricant charge; transmission and motor oil were instead treated as sold to customers.
State
CA
Ruling
Annotation 315.0580
Tax type
Sales and Use Tax
Issued
1952-03-19
Issued by
California State Board of Equalization
Requested by
A business providing chassis-lubrication services and selling motor oils
Topics
lubricants lump sum consumer
Source
View Original PDF

Apply this to your situation

This page answers the general question as of 1952. Ask about yours and see what current California tax law says, with citations.

Currency note: this ruling is from 1952
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 1952 opinion distinguished lubricant included without a separate charge in a lump-sum chassis service from transmission oil and motor oil treated as customer sales. Different separate charges, product transfers, bundled services, materials, or invoice terms could change the result. Current automotive-service, lubricant, oil, lump-sum, and consumer-versus-retailer rules control today.
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

A chassis-lubrication shop could treat itself as the consumer of lubricant when it billed customers one lump sum for the service and did not separately charge for the lubricant. The shop paid tax to its vendors and did not charge customers sales tax on that service.

Transmission oil and motor oil were treated differently: California regarded those products as sold to the customer, so tax applied to their sales.

Common questions

Did a lump-sum chassis service include a taxable lubricant sale?

No, under the source's no-separate-charge facts.

Who consumed the chassis lubricant?

The service provider.

Were motor and transmission oil treated the same way?

No. They were treated as customer purchases.

Citations and references

The supporting opinion does not cite a specific statute or regulation.

Source

Original ruling text

315.0580

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

March 19, 1952

Account No - - XXXXX

S--- M---, Inc.
XXXXX --- --- Boulevard
---, California

Attention:

Mr. S--- R. T---, Vice President

Gentlemen:
This is an answer to your letter of February 2 in which you request confirmation of your understanding that you may regard yourself as the consumer of lubricants used in your Chassis Lubrication Service. We advise that your understanding is correct. You may pay sales tax to your vendors and not charge sales tax to your customers provided you bill your customers a lump-sum for the lubrication service and do not charge separately for the lubricant. As to transmission oil and motor oil, however, you are considered to be selling such items to your customers and the tax is applicable to such sales. Very truly yours,

E. H. Stetson
Tax Counsel

NBH:ja

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