Were out-of-state printed railroad tariff correction supplements distributed at least every three months exempt from California use tax?

Plain-English summary

The live annotation names Pacific Southcoast Freight Bureau; the letter itself calls it only P. P was an association of five railroads. It used out-of-state printers to produce tariffs and supplements for member railroads and had paid use tax measured by its cost for both.

The supplements were tariff correction pages issued at least once every three months. Based on the requester's information, California found them similar or identical in form and purpose to tariff correction pages previously treated as exempt periodicals. The letter does not identify or include those prior rulings.

The supplements qualified under former section 6362, so those published outside California and distributed within the state were exempt from use tax. Although the request concerned tariffs and supplements and P had paid tax on both, the stated conclusion addresses only the supplements; it does not decide the complete tariffs' treatment.

Source and live-annotation limits

The official PDF does not include the October 25 request, association or member records, tariffs, supplements, correction pages, publication schedule, printer contracts, invoices or costs, out-of-state production evidence, California distribution records, prior exempt-page rulings, returns, tax calculations or payments, refund claim, audit, assessment, claim, appeal, or later outcome. The requester, P, printers, railroads, publications, transactions, and amounts are redacted or unidentified in the letter.

The source first prints lowercase “p” and later uppercase “P.” The original-text section preserves those forms rather than silently normalizing them.

The live annotation preserves the Pacific Southcoast Freight Bureau name, out-of-state publication, member-railroad distribution, three-month frequency, correction-page character, and exemption result. It omits the October request, source redaction, five-railroad association, complete tariffs, out-of-state printers, use tax already paid on cost, requester's submitted information, unidentified prior rulings and similar-or-identical analysis, complete-tariff uncertainty, missing records, redactions, and outcome limits.

What this means for you

Carrier associations and tax professionals

Document every tariff and supplement, actual issue schedule, correction-page format, member distribution, printing location, costs, invoices, returns, tax payments, and the distinction between recurring supplements and complete tariff materials.

Common questions

Q: How often were the supplements issued?

A: At least once every three months.

Q: What were they?

A: Correction pages for railroad tariffs.

Q: What tax result did California reach?

A: The out-of-state published supplements distributed in California were exempt from use tax.

Q: Did the letter decide the complete tariffs' tax treatment?

A: No. Its conclusion addressed only the tariff supplements.

Citations and references

• Former California Revenue and Taxation Code § 6362
• Prior rulings treating similar or identical correction pages as exempt periodicals — referenced but not identified or included
• October 25 request, tariffs, supplements, printing, distribution, transaction, and tax records — described or implicated but not documented

Verbatim support

From the official Associate Tax Counsel letter:

It has had tariffs and supplements printed by out-of-state printers for member railroads, and has paid use tax measured by its cost of such tariffs and supplements.

Accordingly, the tariff supplements which are published out of state and distributed in this state are exempt from use tax.

Source

• Annotated Legal Opinions collection: CDTFA Annotated Legal Opinions
• Annotation page: Annotation 385.0660
• Original supporting opinion: 385.0660 PDF

Original ruling text

385.0660

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

November 1, 1965

Gentlemen:
This is in reply to your letter of October 25 regarding the application of sales or use tax with respect to tariff supplements issued by "P". It is our understanding that "p" is an association of five railroads. It has had tariffs and supplements printed by out-of-state printers for member railroads, and has paid use tax measured by its cost of such tariffs and supplements. The supplements are correction pages which are issued at least once every three months. On the basis of the information which you have submitted it appears that the supplements are similar, if not identical, in form and purpose, to tariff correction pages which have been ruled to be exempt periodicals. It is therefore our opinion that the tariff supplements qualify as periodicals under Section 6362 of the Revenue and Taxation Code. Accordingly, the tariff supplements which are published out of state and distributed in this state are exempt from use tax.

Very truly yours,

George A. Trigueros
Associate Tax Counsel

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