Tax & Accounting Blog

Sales Tax: California BOE Announcement of Regulatory Change

Indirect Tax, ONESOURCE, Sales and Use Tax October 10, 2011

The California State Board of Equalization has announced that the recently adopted amendments to Sales and Use Tax Regulations 1533.2, Diesel Fuel Used in Farming Activities or Food Processing, and 1598, Motor Vehicle and Aircraft Fuels, were approved by the Office of Administrative Law on September 26, 2011, and filed with the Secretary of State. The effective date of the amendments is October 26, 2011.

The amendments to Regulation 1598 incorporate the additional sales and use tax on diesel fuel imposed by Revenue and Taxation Code (RTC) sections 6051.8 and 6201.8, effective July 1, 2011, incorporate the exemptions from the additional sales and use tax provided by RTC section 6357.3, and prescribe the exemption certificate for use with the exemptions.  The amendments to Regulation 1533.2 clarify that the partial exemption for diesel fuel used in farming activities or food processing applies to the additional sales and use tax on diesel fuel and will no longer apply to the one percent sales and use tax imposed under RTC sections 6051.7 and 6201.7, effective July 1, 2011.