What documentation approach did California propose for hospitals buying oxygen and other medical or anesthetic gases?

Plain-English summary

California tax counsel reported working with hospital counsel to have hospitals furnish exemption certificates to vendors of oxygen and other medical or anesthetic gases. The memorandum suggested telling a vendor that the Board was addressing the documentation problem.

Pending completion of the arrangement, counsel thought auditors probably could accept hospital sales of medical and anesthetic gases as exempt without additional proof that the gases were not put to nonexempt use. The source mentions an attached certificate form but does not reproduce it.

Common questions

What documentation did the memorandum propose?

Hospital-provided exemption certificates for vendors of medical and anesthetic gases.

Did the published supporting text include the certificate form?

No. It only states that a suggested form was attached to the original memorandum.

Was the interim audit approach stated as a permanent rule?

No. It was framed as a probable temporary approach pending completion of the arrangement.

Citations and references

• The memorandum did not cite a numbered statute or regulation.

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: https://cdtfa.ca.gov/lawguides/vol2/suta/425-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/425-0120.pdf

Original ruling text

State of California

Board of Equalization

425.0120

Memorandum
To:

REDACTED TEXT – Auditing (SNS)

From:

Tax Counsel (EHS)

Subject:

“R”

Date:

April 10, 1964

As a result of your memo of April 1, we have contacted counsel for the "C" and have written him a letter, copy enclosed. He was most cooperative and expressed complete willingness to advise his hospitals that tax exemption certificates should be furnished to vendors of oxygen and other medical or anesthetic gases. There is attached hereto a suggested form of certificate which we included in our letter to "C". We believe that this should eliminate the difficulty which was explained in the letter to you of March 30 from "R". We suggest that you contact "R", which wrote you on March 30, telling them that we are working on this problem looking toward having hospitals supply exemption certificates to vendors of medical and anesthetic gases. I would think that, pending completion of this arrangement, we would probably be justified in accepting sales of medical and anesthetic gases to hospitals as exempt without the necessity of further proof that the gases were not put to a nonexempt use. EHS:o’b [lb]