Could a photographer buy color film for resale when the photographer would actually resell that film as the finished picture or part of it?

Plain-English summary

The letter treated color film as bought for resale when the photographer actually resold it as the finished picture or as part of that picture. It compared the film to the photographic paper on which ordinary prints were made.

The same letter addressed two additional transactions. It said a separately stated reproduction-rights charge was included in the taxable measure for a photographic print sold to a magazine or newspaper. It also pointed to historical Ruling 55 for the rule that qualifying sales to out-of-state purchasers in interstate commerce were not subject to California sales tax.

Live annotation and source posture

The current live annotation preserves the color-film, finished-picture, resale and May 11, 1950 points. It says the photographer exposes and sells the film; the linked letter does not use exposes in this answer and instead requires that the photographer actually resells it. The live page also omits the source's separate or as a part thereof branch, photographic-paper analogy, full-charge reproduction-right conclusion, historical interstate-commerce statement, missing May 4 inquiry and missing Rulings 2, 23 and 55.

The supporting PDF supplies no year or copy of the May 4 inquiry, requester or photo-finisher identity, color film, finished picture, evidence the film itself or part of it was resold, photographic print, magazine or newspaper agreement, reproduction-right license, separate charges, customer location, order, invoice, payment, shipment, interstate-commerce evidence, tax return, audit, assessment, refund or later result. It says copies of Rulings 2, 23 and 55 were enclosed, but none appears in the one-page PDF. The letter's conclusions therefore classify three described situations without proving that a completed transaction met their conditions.

CDTFA's Annotated Legal Opinions collection says letters are summarized as annotations and that statutory law controls whenever a statute and annotation conflict. The official PDF has a clean native text layer and one small page-one letterhead stencil rather than scanned text, so no OCR was required. Both fresh direct PDF downloads and both live-page downloads were byte-identical, duplicate default PDF text extractions matched, and the original-text section remains byte-identical to its committed version and the fresh extraction after removal of only the extractor's terminal newline and form feed.

What this means for you

Preserve evidence showing whether the color film itself is resold as the picture or part of it, rather than merely used to create some different output. Separately stating reproduction rights did not remove that charge from the print's measure under this letter, and an interstate result required the conditions in a historical ruling not reproduced here.

Common questions

Q: Did the letter require the photographer to resell the color film itself?

A: Yes. It described film the photographer actually resells as the finished picture or part of it.

Q: Did the source itself say the photographer exposed the film?

A: No. That word appears in the live annotation, not the linked letter's resale sentence.

Q: Was a separately stated reproduction-right charge excluded from the print's taxable measure?

A: No. For a print sold to a magazine or newspaper, the letter applied tax to the full charge.

Q: Were all sales to out-of-state customers exempt?

A: The letter only said tax did not apply if the sale was in interstate commerce as historical Ruling 55 defined it. The inquiry, ruling and shipment evidence are absent.

Citations and references

• Historical California Sales and Use Tax Rulings 2, 23 and 55 — described as enclosures but absent
• Section A-1-(c) of historical Ruling 55 — cited for interstate commerce but not reproduced
• May 4 inquiry, film and print transactions, reproduction-right agreement, charges, interstate shipment, tax filings and outcomes — implicated but absent

Verbatim support

From the official May 11, 1950 Associate Tax Counsel letter:

With respect to the measure of the tax upon your sale of a photographic print to a magazine or a newspaper for which separate charges are made covering the sales price of the print and the reproduction right for the print, it is our opinion that the tax applies to the full charge.

We regard the sale of color film to a photographer which he actually resells as a finished picture or as a part thereof to be a sale for resale and not subject to tax.

In this case the film is regarded in the category of the paper upon which prints are made as in the case of an ordinary photograph.

You will note that the State sales tax does not apply to sales of tangible personal property to out-of-state purchasers if the sale is in the course of interstate commerce, as defined by Section A-1-(c) of Ruling 55.

Source

• Annotated Legal Opinions collection: CDTFA Annotated Legal Opinions
• Live annotation: Annotation 420.0380
• Original supporting opinion: 420.0380 PDF

Original ruling text

420.0380

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION
May 11, 1950

Dear Sir:
This is in answer to your letter of May 4 with respect to the application of the State sales tax to various transactions referred to therein. With respect to the measure of the tax upon your sale of a photographic print to a magazine or a newspaper for which separate charges are made covering the sales price of the print and the reproduction right for the print, it is our opinion that the tax applies to the full charge. We regard the sale of color film to a photographer which he actually resells as a finished picture or as a part thereof to be a sale for resale and not subject to tax. In this case the film is regarded in the category of the paper upon which prints are made as in the case of an ordinary photograph. For your information we are enclosing copies of each of Sales and Use Tax Rulings 2, 23, and 55. You will note that the State sales tax does not apply to sales of tangible personal property to out-of-state purchasers if the sale is in the course of interstate commerce, as defined by Section A-1-(c) of Ruling 55. Very truly yours,

R. G. Hamlin
Associate Tax Counsel
RGH:HB