Did a California acupuncture certificate by itself exempt an acupuncturist's sales of herbs and drugless substances?

Plain-English summary

The December 12, 1980 opinion addressed SB 1558, chapter 1313, which it said superseded AB 3040, chapter 357. The quoted acupuncture provision authorized a certificate holder to prescribe the use of nutrition, including drugless substances and herbs as dietary supplements to promote health.

The agency said that use of prescribe did not carry the same meaning as the prescription authority in historical Business and Professions Code section 4036. The source quotes that provision as allowing only a physician, dentist, podiatrist, veterinarian, and omitted categories represented by an ellipsis to prescribe or write a prescription.

An acupuncturist without separate statutory authority to write prescriptions remained a retailer of the herbs and drugless substances and needed a seller's permit. If the acupuncturist also was a licensed physician or another independently authorized prescriber and furnished qualifying products for treatment, or a pharmacist filled the prescription, the historical opinion treated the patient sale as exempt.

The May 14, 1996 Non-Attorney Opinions memorandum reviewed the 1980 material and expressly agreed with the conclusion. It did not supply new transaction facts or a current-law analysis.

Live annotation and source posture

The current live annotation closely follows the two source documents and lists both dates. It preserves section 4036, the independent-authority condition, the direct-furnishing and registered-pharmacist branches, the seller's-permit result, and the exemption conclusion.

The 1980 document's footnote says section 4036 is now section 4040; the live page continues to quote section 4036 without the renumbering note. The 1996 document first refers to section 4036 and later visibly prints Section 403, an unexplained missing digit. This page preserves the source text, identifies the typo, and does not substitute a modern section or claim current scope.

The source also prints holder therefor in the 1980 quotation and holder thereor in the 1996 quotation, while the live page uses holder thereof. Those wording differences do not alter the stated tax conclusion but show why the original text remains available verbatim.

No December 5, 1980 discussion record, requester identity, acupuncture certificate, separate professional license, herb, drugless substance, patient, treatment record, prescription, pharmacist record, sale, invoice, seller's permit, return, audit, assessment, refund or applied outcome is supplied.

CDTFA's Annotated Legal Opinions collection says these documents are summarized as annotations and statutory law controls over an inconsistent annotation. The official three-page PDF has native text and one page-one letterhead image, so no OCR was required. Two fresh direct PDF downloads and two live-page downloads were byte-identical; duplicate default text extractions also matched.

What this means for you

An occupational scope rule allowing an acupuncturist to recommend or prescribe the use of herbs did not itself establish the separate prescription authority needed by this historical tax analysis. Verify the seller's professional licenses, who furnishes or dispenses the product, the patient-treatment facts, and current law.

Common questions

Q: Was an acupuncture certificate alone enough for the exemption?

A: No. The opinion said SB 1558's wording did not create the prescription authority required by the cited prescription statute.

Q: Could an acupuncturist make an exempt sale under the opinion?

A: Yes, if the acupuncturist separately qualified as an authorized prescriber and the furnishing or registered-pharmacy conditions were met.

Q: What happened without separate prescribing authority?

A: The herb and drugless-substance sales were taxable, and the acupuncturist had to hold a seller's permit.

Q: Did the 1996 review update the law?

A: No current-law update appears. It says only that the reviewer agreed with the 1980 conclusion.

Missing evidence and references

• December 5, 1980 discussion record — described but absent
• Requester and any affected acupuncturist — redacted or unidentified
• Acupuncture certificate and separate professional licenses — absent
• Herbs, drugless substances, patient-treatment and prescription records — absent
• Pharmacist dispensing, sales, invoices and seller's permit — absent
• Returns, audits, assessments, refunds and applied outcomes — not supplied

Verbatim support

From the official 1980 opinion and 1996 review:

We have discussed this matter with our legal staff who have advised us that the meaning of “prescribe” under this law does not fall within the context of the word “prescribe” pursuant to Section 4036* of the Business and Professions Code.

Unless an acupuncturist is a person authorized under Section 4036 of the Business and Professions Code to prescribe or write a prescription, his sales of drugless substances and herbs are subject to sales tax and such persons must hold a seller’s permit.

If an acupuncturist is an “authorized person”, i.e., a licensed physician or other person specified in Section 4036, and prescribes drugless substances and herbs, which he furnishes to his patient for treatment, or which are dispensed on prescription filled by a registered pharmacist in accordance with the law, such acupuncturist is not required to hold a seller’s permit and the sales to the patient are exempt from tax.

We are in agreement with his conclusion, as follows:

Citations and references

• SB 1558 (1980), Chapter 1313 — acupuncture authority concerning nutrition, herbs, and drugless substances
• AB 3040, Chapter 357 — identified as superseded by SB 1558
• Historical Business and Professions Code § 4036, later § 4040 — persons authorized to prescribe or write prescriptions, as described by the source

Source

• Annotated Legal Opinions collection: CDTFA Annotated Legal Opinions
• Live annotation: Annotation 425.0004
• Original supporting opinion and review: 425.0004 PDF

Original ruling text

425.0004

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION
1020 N STREET, SACRAMENTO, CALIFORNIA
(P.O. BOX 942879, SACRAMENTO, CALIFORNIA 94279-0001)
(916) 445-0387

December 12, 1980

Mr. A--- K--XXXX - XXth Street, Suite XXX
---, California XXXXX
Dear Mr. K---:

As we have discussed on December 5, 1980, herewith is a summary of our position on the sales and use tax implications of SB 1558, Chapter 1313, which supersedes AB 3040, Chapter 357, concerning acupuncturists and their related activities. SB 1558, Chapter 1313, provides that, “An acupuncturist’s certificate authorizes the holder therefor: (b) To… prescribe the use of…nutrition, including the incorporation of drugless substances and herbs as dietary supplements to promote health”. In addition, this law does not prohibit “any other persons” from prescribing the same kinds of drugless substances and herbs “so long as such activities are not…prescribed in connection with the practice of acupuncture”. We have discussed this matter with our legal staff who have advised us that the meaning of “prescribe” under this law does not fall within the context of the word “prescribe” pursuant to Section 4036* of the Business and Professions Code. Section 4036 of the Business and Professions Code provides that, “No person other than a physician, dentist, podiatrist, or veterinarian,…shall prescribe or write a prescription”. Therefore, the provision of SB 1558 will not change the application of the sales tax to sales of herbs and drugless substances by acupuncturists. Unless an acupuncturist is a person authorized under Section 4036 of the Business and Professions Code to prescribe or write a prescription, his sales of drugless substances and herbs are subject to sales tax and such persons must hold a seller’s permit. If an acupuncturist is an “authorized person”, i.e., a licensed physician or other person specified in Section 4036, and prescribes drugless substances and herbs, which he furnishes to his patient for treatment, or which are dispensed on prescription filled by a registered pharmacist in

Mr. A--- K---

-2-

December 12, 1980
425.0004

accordance with the law, such acupuncturist is not required to hold a seller’s permit and the sales to the patient are exempt from tax. Should you have any questions relevant to the above, please do not hesitate to contact me. Very truly yours,

D. F. Brady
Principal Tax Auditor

DFB:j

• Section 4036 of the Business and Professions
  Code is now section 4040.

State of California

Board of Equalization
Legal Division (MIC:82)

Memorandum
425.0004

To:

Mr. Glenn Bystrom

From:

Gary Jugum

Subject:

Non-Attorney Opinions

Date:

May 14, 1996

I have reviewed D. F. Brady’s memorandum of December 12, 1980 to Mr. A--- K---. We are in agreement with his conclusion, as follows:

Acupuncturist. SB 1558, Chapter 1313, provides that, “An acupuncturist’s certificate authorizes the holder thereor: (b) To… prescribe the use of…nutrition, including the incorporation of drugless substances and herbs as dietary supplements to promote health”. The meaning of “prescribe” under this law does not fall within the context of the word “prescribe” pursuant to Section 4036 of the Business and Professions Code. This section provides that, “No person other than a physician, dentist, podiatrist, or veterinarian,…shall prescribe or write a prescription”. Therefore, the provision of SB 1558 will not change the application of the sales tax to sales of herbs and drugless substances by acupuncturists. If an acupuncturist is a licensed physician or other person specified in Section 403 of the Business and Professions Code, and prescribes drugless substances and herbs, which he furnishes to his patient for treatment, or which are dispensed on prescription filled by a registered pharmacist in accordance with the law, such acupuncturist is not required to hold a seller’s permit and the sales to the patient are exempt from tax. 12/12/80

Gary Jugum