Why did California enact the provision addressed in Annotation 495.0680 after adopting the Uniform Commercial Code?

Plain-English summary

California explained that the legislation was intended to prevent an argument that the new Uniform Commercial Code could locate a sale somewhere other than where the property was physically located at the time of sale.

Although some Commercial Code provisions might be read to produce a different place of sale, the Board did not expect the legislation to change how tax was actually applied.

The official publication contains a citation mismatch. CDTFA's annotation text identifies Revenue and Taxation Code section 6010.5, added by Assembly Bill No. 1, while the supporting September 10 letter refers to a request about section 1 of Assembly Bill No. 1086. The shared substantive explanation is reported here without choosing an unsupported correction.

Common questions

What location did the legislation protect?

The place where the property was physically located at the time of sale.

Did the Board expect a practical tax change?

No. The letter said no different application of tax was expected despite the Commercial Code changes.

Which bill did the source identify?

The official annotation page and supporting letter identify different bill numbers, so this page reports both rather than resolving the conflict.

Citations and references

• California Revenue and Taxation Code section 6010.5, identified on CDTFA's annotation page
• Assembly Bill No. 1, identified on CDTFA's annotation page
• Assembly Bill No. 1086, identified in the supporting letter

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/495-0680.pdf

Original ruling text

495.0680
STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

September 10, 1965

Gentlemen:
Under date of August 19, 1965, you wrote to our Los Angeles Subdistrict office for our interpretation of the meaning of section 1 of Assembly Bill No. 1086. Your letter has been referred to this office for reply. The reason for the legislation is to forestall any possible contention that under the provisions of the new Uniform Commercial Code, the place of sale might be deemed to be other than the place where the property is physically located at the time of sale. There are some provisions in that code which might be interpreted as providing for a different place of sale. It is not expected that this change will cause any different application of the tax notwithstanding the changes that were made in the Uniform Commercial Code.

Very truly yours,

E. H. Stetson
Tax Counsel
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