Ezel / Tax Rulings / CA

Was a wheel-balancing business the consumer or retailer of wheel weights furnished during balancing?

Short answer It was the consumer when wheel weights were worth less than ten percent of the total charge and were not separately charged.
State
CA
Ruling
Annotation 315.0940
Tax type
Sales and Use Tax
Issued
1977-08-02
Issued by
California State Board of Equalization
Requested by
Internal memorandum concerning wheel-balancing businesses
Topics
repair materials consumer separate charge ten percent test
Source
View Original PDF

Apply this to your situation

This page answers the general question as of 1977. Ask about yours and see what current California tax law says, with citations.

Currency note: this ruling is from 1977
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 brief 1977 internal memorandum assumed the fair retail value of wheel weights was less than ten percent of the total balancing charge and the weights were not separately charged. Different pricing, separate statements, material values, parts, or services could change retailer-versus-consumer treatment. Current wheel-service, repair-material, invoicing, and ten-percent 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

California applied the repair-material rules to wheel-balancing businesses. The memorandum assumed the fair retail value of wheel weights was less than ten percent of the total balancing charge.

Under that assumption, a wheel balancer that did not separately charge for the weights was their consumer rather than their retailer. The source also noted inconsistent industry treatment and contemplated a release explaining the conclusion.

Common questions

Was every wheel balancer automatically a consumer of weights?

No.

What assumptions supported consumer treatment?

Weights worth less than ten percent of the total charge and no separate weight charge.

What if the weights were separately stated?

The source's consumer conclusion would not apply.

Citations and references

  • California Code of Regulations, title 18, Regulation 1546

Source

Original ruling text

State of California

Board of Equalization

Memorandum

To:

Mr. Donald F. Brady

From:

Glenn L. Rigby

Subject:

Wheel Balancing

315.0940

Date:

August 2, 1977

Pursuant to our discussion of the 27th, it was agreed that for the most part it was our opinion wheel balancers should be governed by Regulation 1546. It was also my understanding we were of the opinion the fair retail value of the weights supplied by the wheel balancer is less than 10 percent of the total charge made for the balancing. Accordingly unless the wheel balancer separately states the charges for the weights, he would be regarded as the consumer. In view of the inconsistency in the method wheel balancers handle these transactions it was concluded that it would be necessary for us to prepare some sort of a release notifying the wheel balancers of our conclusions. If any of the foregoing conclusions are incorrect, please let me know.

GLR/at
cc:

Mr. Robert Nunes
Mr. T. P. Putnam

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