Were hats, caps, turbans, sleep caps, and wig liners exempt accessories to cranial prostheses?

Plain-English summary

A cranial-prosthesis seller asked California to treat hats, caps, turbans, sleep caps, and wig liners as exempt prosthetic products or related supplies.

California said a prosthetic device must replace or assist a natural part of the body. A wig may do that under strictly defined circumstances, but a hat or similar head covering merely covers or protects the head.

The products were wearing apparel, not medicine or related prosthetic supplies, and their sales were taxable.

Common questions

Can a wig qualify as a prosthetic device?

Potentially, under the strictly defined circumstances referenced in the memorandum.

Did that make hats and turbans exempt too?

No.

Why were the head coverings taxable?

They did not replace or assist a natural body part.

Citations and references

• 18 Cal. Code Regs. § 1591(a), (b)(5) — qualifying prosthetic devices furnished as medicines

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/425-0292-500.pdf

Original ruling text

State of California

Board of Equalization
Legal Division-MIC: 82

Memorandum
425.0292.500
To :

Mr. Vic Anderson
Supv., Aud. Eval. & Plan Sect. (MIC:40)

From :

John L. Waid
Senior Tax Counsel

Date:

August 18, 1997

Telephone: (916) 324-3828

CalNet 454-3828

SR -- XX-XXXXXX
The N--- S--Cranial Prostheses and Accessories

Subject:

I am responding to your memorandum to Assistant Chief Counsel Gary J. Jugum dated July 9, 1997. You attached to your memorandum a copy of a letter dated June 10, 1997, from Dr. G--- E. T--- to Ms. Karen Hughes of your section, requesting an opinion on the application of sales tax to N--- S---’s sales of head coverings, including hats, caps, turbans, sleep caps and wig liners. Although Dr. T--- writes as a member of the L--- O--- W--- Medical Group, the file indicates that he is the President of the taxpayer. The file also indicates that N--- S--- is operated under the aegis of the [L--- O---] W--- Medical Group; the exact relationship is not evident. The letter is written on N--- S---’s letterhead. You also attached to your memorandum Ms. Hughes’ draft response. She opined that head coverings, along with wigs, bangs, and hoops of hair would be included as prostheses under Regulation 1591(b)(5), the sales of which under Regulation 1591(a) would not be subject to tax. She cited Annotation 425.0397 (4/27/90) as authority. We do not agree. Under the regulation, a prosthetic device must assist or replace a natural part of the body. We said in the letter supporting the annotation that, under the strictly-defined circumstances stated therein, a wig can do that. On the other hand, a hat does not assist or replace a natural part of the body. It is a hat. It covers the head. Wearing apparel is not listed in the regulation among the items deemed to be “medicines” nor does it even qualify as “related supplies.” Its purposes are generally cosmetic, or fashion, or to supply protection for the head in addition to that supplied by hair. We thus conclude that hats and caps, etc., do not qualify as medicines under the regulation. As a result, their sales are subject to tax.

JLW:sr