Laws, Regulations and Annotations


Business Taxes Law Guide—Revision 2024

Sales and Use Tax Annotations

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325.0000 Interstate and Foreign Commerce—Regulation 1620

Annotation 325.0664

(c) Shipments from California to Points Outside State

(2) Delivery to Purchaser in State

325.0664 Carrier Hired by Purchaser. An instate retailer will ship merchandise from a location within California. The purchaser will choose the carrier, who will pick up the merchandise and deliver it to the purchaser's location in another state.

For purposes of this opinion, it is assumed that neither the purchaser nor its agent or representative will take possession or control of the merchandise in this state. It also is assumed the purchaser will hire a common carrier to take delivery of the merchandise in California, the purchaser is not a resident of California, and the merchandise is purchased for use outside California. The two requirements of the interstate exemption are: the contract of sale must require shipment outside of California, and the property must be shipped outside of California without the purchaser or its agent or representative taking possession or control of the property in California. When a common carrier transports the property outside California, either party can hire the carrier. Accordingly, if the transaction satisfies these conditions of the exemption, the sale would be exempt from sales tax. 11/2/95.