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 325.1100

(c) Shipments from California to Points Outside State

(5) Exports

325.1100 Customization of Motorcycles. An out-of-state company purchases motorcycles which are customized in California. After the customization is complete, a freight forwarder picks up the motorcycles in California and exports them to a foreign buyer in Japan or Europe. When the out-of-state company will resell the motorcycles prior to any functional use, the customization does not result in a taxable use of the motorcycle.

Since the only transactions by the out-of-state company involve sales in foreign commerce, it is not required to hold a seller's permit. It may issue resale certificates to its suppliers noting thereon that it is not required to hold a seller's permit (See Regulation 1668). 4/23/92.