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BTLG Table of Contents > Sales and Use Tax Annotations > M > 347.0000 Manufacturing Equipment > Annotation 347.0676

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347.0000 Manufacturing Equipment—Regulation 1525.2

Annotation 347.0676

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347.0676 New Trade or Business. A taxpayer is constructing a manufacturing facility in California. It began construction of this facility after January 1, 1994. Neither the taxpayer nor any related party have owned or operated any manufacturing facilities within California within the last three years. The taxpayer has a sales office located in California, but only engages in sales solicitation from this office.

Since the sales operations from the California sales office fall within the nonmanufacturing SIC division F, "Wholesale Trade" (durable and nondurable goods), the taxpayer's activities inside this state do not constitute a manufacturing operation previously undertaken in this state. Therefore, the taxpayer is not precluded from qualifying as a new trade or business for purposes of Revenue and Taxation Code section 6377 based on its current and past sales operations inside this state. 11/5/96.