Ezel / Tax Rulings / CA

Were filters that became part of firmly installed vessel engines exempt watercraft components?

Short answer Yes. California treated filters as component parts because they became part of ship engines and were firmly affixed in place during use. The sale was exempt only if the vessel itself met the other watercraft-exemption conditions.
State
CA
Ruling
Annotation 600.0400
Tax type
Sales and Use Tax
Issued
1950-03-17
Issued by
California State Board of Equalization
Requested by
A redacted seller of vessel-engine filters
Topics
component parts substantial attachment replacement parts
Source
View Original PDF

Apply this to your situation

This page answers the general question as of 1950. Ask about yours and see what current California tax law says, with citations.

Currency note: this ruling is from 1950
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This is a March 17, 1950 California State Board of Equalization tax-counsel letter published by CDTFA as support for a sales and use tax annotation. It addresses filters that became part of vessel engines and were firmly attached during use. The letter expressly conditions exemption on the watercraft satisfying Ruling 51.5's other requirements. This summary is informational only and is not legal or tax advice.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page as a PDF) is the authoritative source for any reliance.
View original ruling (PDF)

Plain-English summary

California considered whether filters sold to vessel operators became watercraft component parts.

The filters became part of the ships' engines and were firmly attached or affixed while in use. California therefore treated them as components under section 6368.

The sale was exempt only if the vessel's use also met the conditions described in Ruling 51.5.

What this means for you

Engine-parts sellers, vessel operators, and tax advisers

Document how the filter fits into the installed engine and the vessel's qualifying operations. Physical integration answers only the component question, not every element of the exemption.

Common questions

Q: Did the filters become vessel components?

A: Yes.

Q: What supported that result?

A: They became part of the engines and were firmly attached during use.

Q: Was component status alone enough?

A: No. The vessel also had to satisfy the exemption's use conditions.

Citations and references

  • California Revenue and Taxation Code § 6368
  • California Sales and Use Tax Ruling 51.5, as cited in the source

Source

Original ruling text

600.0400

March 17, 1950

Gentlemen:
We regret the delay in responding to your letter of December 7, but we have been giving consideration to a large number of items sold to operators of vessels as to whether the items are ''component parts" of the vessels, within Section 6368 of the Sales and Use Tax Law and Sales and Use Tax Ruling 51.5, copy enclosed.

I .

As these filters apparently become a part of the ships' engines and are firmly attached or affixed in place when in use, it is our opinion that they may be regarded as becoming a component part of the watercraft and the sale of. them is, therefore, within the exemption, provided, of course, the use of the watercraft is such as to fall within the conditions of the exemption as explained in Ruling 51.5. Very truly y9urs

E. H. Stetson
Tax Counsel
EHS :ph

  • ·

cc:

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