Could a city buy sodium silicofluoride and quicklime for resale when the chemicals remained in purified water?

Plain-English summary

A city water department submitted engineering statements that sodium silicofluoride and quicklime used in purification remained as components of the treated water.

The city could purchase the chemicals for resale to the extent it actually sold the water containing them. The portion attributable to water the city itself consumed—for swimming pools, irrigation, or other municipal purposes—remained taxable.

The letter directed pending refund claims to be processed using that sold-versus-consumed allocation.

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: https://cdtfa.ca.gov/lawguides/vol2/suta/440-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/440-2460.pdf

Original ruling text

440.2460

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

January 19, 1962

--- --- Water Department
Water Purification Division
---, California
Attention:

Mr. H--- W. T---, Manager

Gentlemen:
Thank you for your letter of January 8 enclosing statements by H--- W. T---, Registered Chemical Engineer, relative to the retention in the water supply of sodium silicofluoride and quicklime. Upon the basis of the statements by Mr. T---, we are prepared to regard these chemicals as becoming component parts of the water which is sold so that they may be purchased by the city for resale to the extent that the city actually resells the water. Any water used for municipal purposes, such as swimming pools, irrigation, etc., would be consumed by the city and the tax would apply to the sale of the chemicals to the city. We shall process pending refund claims in accordance with the foregoing views. Very truly yours,

E. H. Stetson
Tax Counsel

EHS:o’b

cc:

--- --- – Tax Administrator