Sales And Use Tax Regulations - California Board Of Equalization printable pdf download

State of California

BOARD OF EQUALIZATION

SALES AND USE TAX REGULATIONS

Regulation 1574. VENDING MACHINE OPERATORS.

References:

Sections 6015, 6066-6068, 6353, 6359, 6359.2, 6359.4, 6359.45, 6363, 6364, 6370, Revenue and Taxation Code. Canteen

Corporation v. State Board of Equalization (1985), 174 Cal. App. 3d 952.

(a) GENERAL.

(1) PERMITS. Persons operating vending machines dispensing tangible personal property of a kind the gross

receipts from the retail sale of which are subject to tax or dispensing food products at retail for more than 15 cents

must obtain permits to engage in the business of selling tangible personal property. One permit is sufficient for all

machines of one operator.

A statement in substantially the following form must be affixed upon each vending machine in a conspicuous place:

"This vending machine is operated by

________________________________________________________

NAME OF OPERATOR

________________________________________________________

ADDRESS OF OPERATOR

who holds Permit No._________ issued pursuant to the Sales and Use Tax Law."

(2) RECORDS. Adequate and complete records must be kept by the operator showing the location or locations

of each machine operated by him or her, the serial number thereof, purchases and inventories of merchandise

bought for sale through all such machines, the prices charged by the operator, the gross receipts derived from the

operation at each location, the receipts from exempt sales, and where applicable, the sales price to the operator of all

tangible personal property of which the operator is the consumer, see subdivision (b). Records must be kept of the

receipts derived from each machine at a location if differing kinds of merchandise are vended through separate

machines at that location.

(3) SCHEDULE SHOWING ALLOCATION BY COUNTY. If the machines are operated in more than one

county, a schedule must be attached to the return showing the tax allocable to each county. If a person purchases

property under a resale certificate and dispenses it through a vending machine under circumstances where the

person is considered to be the consumer of the property, see subdivision (b), a schedule must be attached to the

return showing the use tax due thereon allocable to each county.

(4) SALES TO OPERATORS NOT FURNISHING RESALES CERTIFICATES.

Persons making sales of

tangible personal property of a kind the gross receipts from the retail sale of which are taxable, to operators of

vending machines to be resold through such machines, must notify this board of the name and address of each

operator who fails to furnish a valid resale certificate. In the event such persons fail to so notify the board, or desire to

assume tax liability for the operations of particular vending machines, then, pursuant to Revenue and Taxation Code

Section 6015, they are required to return the tax to the state, measured by the receipts from the retail sale of the

property.

(b) APPLICATION OF TAX.

(1) IN GENERAL. Persons operating vending machines dispensing tangible personal property of a kind the

gross receipts from the retail sale of which are subject to tax must report and pay to the state the tax upon gross

receipts from all sales of such property made through such machines. Sales of tangible personal property through

vending machines are presumed to be made on a tax-included basis. Gross receipts from retail sales of tangible

personal property through the vending machines are total receipts less the amount of sales tax reimbursement

included therein.

Sales And Use Tax Regulations - California Board Of Equalization

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