Were lemon-glycerin swabs, a temporary surgical cannula, and a respiratory suction catheter exempt medicines?

Plain-English summary

California taxed three products as devices rather than medicines. A lemon-glycerin swab lubricated the mouths of patients undergoing other therapy; a “Thiortic Cannula” circulated blood temporarily during open-heart surgery and was removed afterward; and a disposable suction catheter removed mucus during respiratory therapy.

The opinion applied the general rule that items used to diagnose a condition, apply medicine or treatment, or operate temporarily during surgery were taxable devices.

Common questions

Did oral lubrication make the glycerin swab medicine?

No. It facilitated other therapy.

Did being mostly inside the body exempt the surgical cannula?

No. Its use was temporary and it was removed after surgery.

Was the suction catheter exempt?

No.

Citations and references

• California Revenue and Taxation Code section 6369 — prescription-medicine exemption referenced in the opinion
• California Sales and Use Tax Regulation 1591(c)(2) — device exclusion applied to the three items

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/425-1110.pdf

Original ruling text

425.1110
STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

WILLIAM M. BENNETT
First District, Kentfield

1020 N STREET, SACRAMENTO, CALIFORNIA
(P.O. BOX 942879, SACRAMENTO, CALIFORNIA 94279-0001)
(916) 324-3828

BRAD SHERMAN
Second District, Los Angeles
ERNEST J. DRONENBURG, JR.
Third District, San Diego
MATTHEW K. FONG
Fourth District, Los Angeles
GRAY DAVIS
Controller, Sacramento

September 17, 1992
BURTON W. OLIVER
Executive Director

Ms. K--- K--G--- M--- Corporation
XXXX --- Road
P.O. Box XXXXX
---, -- XXXXX-XXXX
Re: SZ – XX-XXXXXX
Sales Tax on Medical Supplies
Dear Ms. K---:
I am responding to your latest letter to me, this one dated June 24, 1992. You asked if sales or use tax applies to sales by your company ("GMC") of certain medical items. OPINION In our previous correspondence I have discussed the legal principles governing the prescription medicines exemption from sales and use tax provided by Revenue and Taxation Code Section 6369, interpreted and implemented by Regulation 1591, and so for the sake of brevity will not repeat it here. (Unless otherwise stated, all further statutory citations are to the Revenue and Taxation Code.) Please remember that, as a rule, items used to diagnose a condition or to apply medicine or treatment to the patient are not considered to be medicines. (Reg. 1591(c)(2).) Based on the above standard, we conclude as to the items at issue as follows:

1. Lemon Glycerin Swab Stick. "This disposable item is utilized for oral lubrication for
   patients on oxygen, general anesthesia, drug therapy, or restricted diet." It appears, then, to be used to facilitate other therapy and so is considered a device, etc., excluded from the definition of the term medicine under Regulation 1591(c)(2). Tax applies to sales of this item.

Ms. K--- K---

-2-

September 17, 1992
425.1110

2. Thiortic Cannula. "This items is utilized during open heart surgery. It's purpose is to
   circulate the blood during surgery. It is mostly within the body during surgery and is removed after the surgery is completed." Items used temporarily during surgery are considered taxable devices.
3. Suction Catheter. This item is used to suction mucous out of the body during
   respiratory therapy. It is a disposable item." We have previously determined that suction catheters are also taxable devices. I hope the above discussion has answered your question. If you need anything further, please do not hesitate to write again. Sincerely,

John L. Waid
Tax Counsel

JLW:es
bc: --- District Administrator