California – Interstate and Foreign Commerce Regulation Amended

SALT Report 2261 – The California State Board of Equalization recently amended Regulation 1620, the sales and use tax regulation regarding interstate and foreign commerce to conform to the changes made to RTC section 6248, subdivision (a)(1) and (4) by AB 1547, and SB 1330 under California Code of Regulations, title 1, section 100.

The amendments to Regulation 1620 are as follows:

  • There is a rebuttable presumption that California use tax applies to the storage, use, or other consumption of a vehicle, vessel, or aircraft purchased outside California, but brought into California more than 50% of the time during the 12 months following its purchase.
  • A closely held corporation or limited liability corporation shall also be considered a California resident if 50% or more of the shares or membership interests are held by shareholders or members who are residents of California as defined in Section 516 of the Vehicle Code.
  • Aircraft and vessels brought into the state exclusively for repair, retrofit, or modification are excluded from the rebuttable presumption described above. The exception will only apply to vessels when the services are “performed by a repair facility that holds an appropriate permit issued by the Board and is licensed to do business by the county in which it is located.” The exclusion for aircraft will only apply when the services are “performed by a repair station certified by the Federal Aviation Administration or the manufacturer’s maintenance facility.”

The amendments in Regulation 1620 were effective March 11, 2013.

For Further Information
California State Board of Equalization – Regulation 1620