Did California use tax apply when a company bought tangible personal property from the State of Utah for use rather than resale?

Plain-English summary

Redacted H. A. Company faxed a June 20 request asking whether another state's government was a Revenue and Taxation Code section 6005 person. It represented that it made unspecified purchases from the State of Utah, not for resale, and that Utah was unregistered and did not collect California tax. The source supplies no property, invoice, delivery, location or use facts.

Staff Counsel Pat S. Hildebrand traced the statutory definitions. Section 6051 imposed sales tax on California retail sales unless exempt. Section 6201 imposed use tax on California storage, use or consumption of property purchased from a retailer. A section 6015 retailer had to be a section 6014 seller, and a seller had to be a section 6005 person.

The quoted person definition included the United States, California, and California counties, municipalities, districts and other political subdivisions, but did not enumerate another state. The opinion therefore concluded Utah was not a section 6005 person and could not be a seller or retailer under the linked definitions.

The opinion quoted Business Taxes Law Guide Annotation 415.0180, which treated the University of Minnesota Press as a Minnesota state agency, not a section 6005 person, and therefore not a retailer for California collection purposes. The official May 18, 1967 supporting memorandum grounds that state-agency status and collection result.

On that definition chain, H. A. Company's Utah purchase was not from a California Sales and Use Tax Law seller or retailer. Counsel called Utah's sale a nontaxable transfer excluded from California sales and use taxation. The source supplies no return, audit, refund, assessment or applied outcome.

Source posture and scope

The live 415.0108 annotation, in the 2026 revision of the Business Taxes Law Guide, preserves the person-to-seller-to-retailer chain and use-tax requirement. It broadens the conclusion beyond this opinion's Utah transaction to foreign governments, other states, their political subdivisions, and their college and university systems. The 1994 supporting source expressly decides Utah and quotes the University of Minnesota Press state-agency annotation; it does not separately analyze foreign governments, every political subdivision, or every college and university system. The live page omits the company, fax, nonresale fact, registration and noncollection representations, sections 6051, 6014 and 6015 text, cited annotation, missing records and absent outcome.

CDTFA's Annotated Legal Opinions collection says statutory law controls over an inconsistent annotation. The official two-page 415.0108 PDF has a clean native text layer and one small page-1 stencil, so no OCR was required. Both fresh direct PDF downloads and both live-annotation downloads were byte-identical, and duplicate default PDF text extractions matched. The original-text tail remains byte-identical to its committed version and matches fresh extraction after removing only terminal extractor whitespace.

What this means for you

Purchasers and tax professionals

Identify the seller's exact governmental status before applying ordinary use-tax rules. This historical opinion turned on the statutory chain from person to seller to retailer, not simply the purchaser's nonresale use. Do not extend its Utah result to every foreign government, subdivision or public institution without current statutory and entity analysis.

Common questions

Q: Did the company's nonresale use by itself create use-tax liability?

A: No. The use-tax statute also required a purchase from a retailer, and the opinion said Utah did not meet the linked definition.

Q: Why was Utah not treated as a retailer?

A: Another state was not among the governmental units enumerated in section 6005, so the opinion said Utah could not be a seller or retailer.

Q: Did the opinion say every government sale is exempt?

A: No. The supporting opinion specifically analyzed Utah and quoted a Minnesota state-agency annotation. The live page states broader categories that this source does not separately analyze.

Q: Does the source show what property was purchased or where it was used?

A: No. The fax, property, delivery, location, use, invoices and tax records are absent.

Q: Did the source show an audit or refund outcome?

A: No. It is an opinion and supplies no return, audit, assessment, payment or refund record.

Citations and references

• California Revenue and Taxation Code sections 6005, 6014, 6015, 6051 and 6201
• Business Taxes Law Guide Annotation 415.0180 and its May 18, 1967 University of Minnesota Press supporting memorandum
• June 20 fax; property, contract, invoice, delivery, location and use records; Utah status and registration records; returns; audit; assessment; payment; refund; and outcome — described or implicated but not included

Verbatim support

From the official August 23, 1994 Staff Counsel opinion:

You state that H--- A--- Company (HAC) made purchases from the State of Utah. The purchases were not for resale. The State of Utah is not registered and did not collect California tax on the transaction.

This means that the California sales and use tax is imposed on retail sales of tangible personal property in California and, in order to be a retailer or a seller, one must be a person as defined in section 6005 of the Revenue and Taxation Code.

Since Utah is not an enumerated person under section 6005, HAC's purchase of tangible personal property from the State of Utah cannot be a purchase from a California Sales and Use Tax seller or retailer.

Source

• Annotated Legal Opinions collection: CDTFA Annotated Legal Opinions
• Live annotation: Annotation 415.0108
• Original supporting opinion: 415.0108 PDF
• Cited earlier opinion: 415.0180 PDF

Original ruling text

415.0108

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

MEMBER
First District

1020 N STREET, SACRAMENTO, CALIFORNIA
(P.O. BOX 942879, SACRAMENTO, CALIFORNIA 94279-0001)
(916) 324-2642

BRAD SHERMAN
Second District, Los Angeles
ERNEST J. DRONENBURG, JR.
Third District, San Diego
MATTHEW K. FONG
Fourth District, Los Angeles
GRAY DAVIS
Controller, Sacramento

August 23, 1994
BURTON W. OLIVER
Executive Director

Mr. R--- H. G--- III
H--- A--- Company - Tax Department
P.O. Box XXXXX - CO/CO1/B116
--- ---, CA XXXXX-XXXX
Re: SY – XX-XXXXXX
Dear Mr. G---:
This is in response to your faxed letter dated June 20, 1994. You ask for a legal opinion on whether, or not, the government of another state is a person under Revenue and Taxation Code section 6005. You state that H--- A--- Company (HAC) made purchases from the State of Utah. The purchases were not for resale. The State of Utah is not registered and did not collect California tax on the transaction. The California Sales Tax is imposed upon retailers. Retail sales of tangible personal property in California are subject to sales tax unless the sale is specifically exempt by statute. (Rev.
& Tax. Code § 6051.) Section 6201 of the Revenue and Taxation Code imposes a use tax on the storage, use, or other consumption in this State of tangible personal property purchased from any retailer for storage, use, or other consumption in this State. Retailer includes every seller who makes any retail sale or sales of tangible personal property, and every person engaged in the business of making retail sales at auction of tangible personal property owned by the person or others and every person engaged in the business of making sales for storage, use, or other consumption or in the business of making sales at auction of tangible personal property owned by the person or others for storage, use, or other consumption. (Rev. & Tax. Code § 6015.) Seller includes every person engaged in the business of selling tangible personal property of a kind the gross receipts from the retail sale of which are required to be included in the measure of the sales tax. (Rev. & Tax. Code § 6014.)

Mr. R--- H. G--- III

-2-

August 23, 1994
415.0108

This means that the California sales and use tax is imposed on retail sales of tangible personal property in California and, in order to be a retailer or a seller, one must be a person as defined in section 6005 of the Revenue and Taxation Code. That section defines person, as follows: "Person" includes any individual, firm, copartnership, joint venture, association, social club, fraternal organization, corporation, estate, trust, business trust, receiver, assignee for the benefit of creditors, trustee, trustee in bankruptcy, syndicate, the United States, this State, any county, city and county, municipality, district, or other political subdivision of the State, or any group or combination acting as a unit." Further explanation is provided in Business Taxes Law Guide Annotation (BTLG Annot.) 415.0180, as follows: The University of Minnesota Press is an agency of the State of Minnesota and not a person under Section 6005 and, accordingly is not a retailer in this State for tax collection purposes. (5/18/67.) Unless property is purchased from a person, as defined under section 6005, it cannot be purchased from a seller or retailer, as those terms are defined in California's Sales and Use Tax Law. Since Utah is not an enumerated person under section 6005, HAC's purchase of tangible personal property from the State of Utah cannot be a purchase from a California Sales and Use Tax seller or retailer. Accordingly, Utah's sale to HAC is excluded from taxation under California's Sales and Use Tax Laws, as a non-taxable transfer. If you have further questions, feel free to write again.

Sincerely,

Pat S. Hildebrand
Staff Counsel

PH:cl
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cc:

--- --- District Administrator