Was influenza vaccine exempt when a company bought it for voluntary employee inoculations supervised by its doctor?

Plain-English summary

California exempted influenza vaccine a company purchased for voluntary employee inoculations. A doctor authorized the purchase, employees who chose vaccination consented to become that doctor's patients for the inoculation, and a nurse administered the vaccine under the arrangement.

The memorandum treated the vaccine as prescribed for human treatment by an authorized person and furnished by a licensed physician to the physician's own patients, even though the doctor did not write a separate prescription for every employee.

Common questions

Did each employee need an individual written prescription?

No under the facts described.

Why did the physician-patient relationship matter?

It supported the historical exemption for medicine furnished by a physician to the physician's own patient.

Could a nurse administer the shots?

Yes under the physician-supervised arrangement described in the memorandum.

Citations and references

• California Revenue and Taxation Code section 6369(1) and (2) — prescription and physician-furnished medicine channels applied in the memorandum

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/425-0440.pdf

Original ruling text

State of California

Board of Equalization

Memorandum

To:

San Jose – Auditing

From:

Tax Counsel (GAT)

Subject:

X-----------------

425.0440

Date:

July 21, 1967

This is in regard to your memo of July 11 concerning chemicals and influenza vaccine purchased by "U". It is our understanding that "U" has been conducting experiments to determine whether fruitflavored liquids containing mixtures of amino acids, vitamins, and minerals can be used safely as food for human beings. These liquids have been served to human beings as their sole diet for periods as long as 6 months. These experiments have been conducted under the supervision of a doctor. Inasmuch as these combinations contain the basic nutritive substances of normal food and are intended to be substitute therefore, it is our opinion that they qualify as exempt food products. It is our understanding that "U" purchases influenza vaccine for voluntary inoculation of its employees. Although a written authorization from a doctor was required for the purchase of the vaccine, no specific prescription is made or required by the doctor for the inoculation of each individual employee. The employees are inoculated with the vaccine by a nurse. Under the foregoing circumstances, it appears that "U"'s employees who desire to be so vaccinated have consented to be the patients of the doctor with whom the center contracted to prescribe and administer or supervise the administration of the vaccine. Thus, since the medicines are prescribed for the treatment of human beings by a person authorized to do so and are furnished by a licensed physician to his own patients for treatment of such patients, the sale and use of the influenza vaccines for such purpose is exempt from tax under paragraphs (1) and (2) of Section 6369.

GAT:ph [lb]