SALT Report 1246 – The Board of Equalization is reminding Californians that use tax may be owed for purchases made online from out-of-state retailers. Payment of California use tax is the responsibility of the purchaser and must be paid either directly to the seller from whom the item was purchased or directly to the Board of Equalization if the retailer is not required to collect and report California tax.
Use tax generally applies to purchases of items that would be subject to sales tax if they had been purchased in the state. In California, that means use tax applies to the sale or use of tangible personal property – items that can be seen, weighed, measured, felt, or touched.
For example, you would owe use tax when:
- You purchase something tax free from a mail order catalog, the Internet, an online auction, or television shopping network and the item is located outside California
- You withdraw taxable merchandise from your business’s resale inventory and use it for your personal or business use
- You purchase vehicles, vessels, mobile homes, and aircraft from sellers who do not hold seller’s permits