Was giving a Bible in response to a requested or suggested donation a sale for California sales-tax purposes?

Plain-English summary

California said a Bible transfer was a sale when the distributor specified a donation amount in exchange for the Bible, even if the payment was called a donation. Tax was measured by the specified amount or a lower amount actually received in connection with the transfer. Money above that amount was treated as a nontaxable donation.

A general request for donations did not create a sale if it suggested no minimum and did not make payment a condition of obtaining or keeping the Bible.

The 1978 letter also described a historical exception: by analogy to Regulation 1670, the distributor was treated as the consumer rather than the seller when the requested amount was less than 50 percent of its purchase price. The source does not establish that this old approach governs a current transaction.

Common questions

Does calling a payment a donation prevent a sale?

No. The opinion focused on whether a specific or minimum amount was consideration for receiving the Bible.

What if someone paid more than the requested amount?

The specified amount, or a lower amount accepted for the transfer, was the taxable measure; the excess was treated as a donation.

Was a completely voluntary donation request taxable?

Not when no minimum was suggested and payment was not required to obtain or keep the Bible.

Citations and references

• California Revenue and Taxation Code section 6006
• California Sales and Use Tax Regulation 1670, used by analogy in the historical opinion
• California Sales and Use Tax Regulation 1620, enclosed by the Board for interstate-commerce questions

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: https://cdtfa.ca.gov/lawguides/vol2/suta/495-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/495-0216.pdf

Original ruling text

495.0216

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION
(916) 445-3723

April 12, 1978

Mr. G--- R--Attorney at Law
XXX --- --- Drive,
Suite XXXX
--- ---, CA XXXXX

The W--- B--- S--No Permit

Dear Mr. R---:
Mr. W--- F---, administrator of our --- --- office, has asked me to write to you regarding the question of when the transfer of a Bible will be considered a sale for sales tax purposes as contrasted with a gift in relation to a donation of money. Section 6006 of the Revenue and Taxation Code defines a “sale” as including “any transfer of title or possession, exchange, or barter, conditional or otherwise, in any manner or by any means whatsoever, of tangible personal property for a consideration. Accordingly, when a consideration is specified for which a Bible will be transferred, the transfer is considered a sale whether the consideration is denominated as a donation or otherwise. This includes a situation where a “donation” in a specific amount is requested or suggested. Tax would be measured by that amount or any lesser amount that is received and pursuant to which the Bible is transferred. Any amount received in excess of that would be considered a nontaxable donation. A Bible will not be considered as sold if there is merely a request for a donation, without in any way suggesting a minimum, or that a “donation” is required as a condition of obtaining or keeping the item. We have recognized one exception to the rule that a transfer of a Bible will be considered a sale whenever a “donation” in a specific amount is requested or suggested, i.e., where the amount is less than 50 percent of the price paid by the person distributing the Bibles. In that event, the distributor has been considered as a consumer rather than a seller of the Bibles. That approach is based on analogy with provisions in Sales and Use Tax Regulation 1670, a copy of which is enclosed.

Mr. G--- R---

-2-

April 12, 1978
495.0216

I understand that you may have some questions regarding exemption for sales in interstate commerce. Enclosed is a copy of Regulation 1620 on that subject. If you have any further questions, please let me know. Sincerely,

Thomas P. Putnam
Assistant Chief Counsel

TPP:po
Enclosures