California Code of Regulations › Title 18 - Public Revenues › Division 2 - California Department of Tax and Fee Administration- Business Taxes (State Board of Equalization- Business Taxes, See Ch. 6 and 9.9) › Chapter 4 - Sales and Use Tax › Article 3 - Manufacturers, Producers, Processors › Section 1535 - Racehorse Breeding Stock

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) General. Commencing on and after
				  September 1, 2001, section
				  6358.5
				  of the Revenue and Taxation Code partially exempts from sales and use tax the
				  sale of, and the storage, use, or other consumption in this state, of racehorse
				  breeding stock purchased for use by a qualified person. The terms "racehorse
				  breeding stock" and "qualified person" are defined below.
For the period commencing on September 1, 2001 and ending
					 December 31, 2001, the partial exemption applies to the taxes imposed by
					 sections
					 6051
					 and
					 6201
					 of the Revenue and Taxation Code (4.75%), but does not apply to the taxes
					 imposed pursuant to sections
					 6051.2
					 and
					 6201.2
					 of the Revenue and Taxation Code, the Bradley-Burns Uniform Local Sales and Use
					 Tax Law, the Transactions and Use Tax Law, or section
					 35 of article XIII of the
					 California Constitution.
For the period commencing on January 1, 2002, and ending on
					 June 30, 2004, the partial exemption applies to the taxes imposed by sections
					 6051,
					 6051.3,
					 6201,
					 and
					 6201.3
					 of the Revenue and Taxation Code (5%), but does not apply to the taxes imposed
					 pursuant to sections
					 6051.2
					 and
					 6201.2
					 of the Revenue and Taxation Code, the Bradley-Burns Uniform Local Sales and Use
					 Tax Law, the Transactions and Use Tax Law, or section
					 35 of article XIII of the
					 California Constitution.
For the period commencing on July 1, 2004, and ending on
					 March 31, 2009, the partial exemption applies to the taxes imposed by sections
					 6051,
					 6051.3,
					 6051.5,
					 6201,
					 6201.3,
					 and
					 6201.5
					 of the Revenue and Taxation Code (5.25%), but does not apply to the taxes
					 imposed or administered pursuant to sections
					 6051.2
					 and
					 6201.2
					 of the Revenue and Taxation Code, the Bradley-Burns Uniform Local Sales and Use
					 Tax Law, the Transactions and Use Tax Law, or section
					 35 of article XIII of the
					 California Constitution.
For the period commencing on April 1, 2009, and ending on
					 June 30, 2011, the partial exemption applies to the taxes imposed by sections
					 6051,
					 6051.3,
					 6051.5,
					 6051.7,
					 6201,
					 6201.3 6201.5 and 6201.7 of the
					 Revenue and Taxation Code (6.25%), but does not apply to the taxes imposed or
					 administered pursuant to sections
					 6051.2
					 and
					 6201.2
					 of the Revenue and Taxation Code, the Bradley-Burns Uniform Local Sales and Use
					 Tax Law, the Transactions and Use Tax Law, or section
					 35 of article XIII of the
					 California Constitution.
For the period commencing on July 1, 2011, and ending on
					 December 31, 2012, the partial exemption applies to the taxes imposed by
					 sections
					 6051,
					 6051.3,
					 6051.5,
					 6201,
					 6201.3,
					 and
					 6201.5
					 of the Revenue and Taxation Code (5.25%), but does not apply to the taxes
					 imposed or administered pursuant to sections
					 6051.2
					 and
					 6201.2
					 of the Revenue and Taxation Code, the Bradley-Burns Uniform Local Sales and Use
					 Tax Law, the Transactions and Use Tax Law, or section
					 35 of article XIII of the
					 California Constitution.
For the period commencing on January 1, 2013, and ending on
					 December 31, 2015, the partial exemption applies to the taxes imposed by
					 section 36 of article XIII of the
					 California Constitution and sections
					 6051,
					 6051.3,
					 6051.5,
					 6201,
					 6201.3,
					 and
					 6201.5
					 of the Revenue and Taxation Code (5.50%), but does not apply to the taxes
					 imposed or administered pursuant to sections
					 6051.2
					 and
					 6201.2
					 of the Revenue and Taxation Code, the Bradley-Burns Uniform Local Sales and Use
					 Tax Law, the Transactions and Use Tax Law, or section
					 35 of article XIII of the
					 California Constitution.
For the period commencing on January 1, 2016, and ending on
					 December 31, 2016, the partial exemption applies to the taxes imposed by
					 section 36 of article XIII of the
					 California Constitution and sections
					 6051,
					 6051.3,
					 6201,
					 and
					 6201.3
					 of the Revenue and Taxation Code (5.25%), but does not apply to the taxes
					 imposed or administered pursuant to sections
					 6051.2
					 and
					 6201.2
					 of the Revenue and Taxation Code, the Bradley-Bums Uniform Local Sales and Use
					 Tax Law, the Transactions and Use Tax Law, or section
					 35 of article XIII of the
					 California Constitution.
For the period commencing on January 1, 2017, the partial
					 exemption applies to the taxes imposed by sections
					 6051,
					 6051.3,
					 6201,
					 and
					 6201.3
					 of the Revenue and Taxation Code (5%), but does not apply to the taxes imposed
					 or administered pursuant to sections
					 6051.2
					 and
					 6201.2
					 of the Revenue and Taxation Code, the Bradley-Burns Uniform Local Sales and Use
					 Tax Law, the Transactions and Use Tax Law, or section
					 35 of article XIII of the
					 California Constitution.
(b)
				  Definitions. For purposes of this regulation:
(1) "Qualified person" means a person who
				  purchases racehorse breeding stock solely with the intent and purpose of
				  breeding.
(2) "Qualified property"
				  means racehorse breeding stock, as defined in subdivision (b)(3).
(3) "Racehorse breeding stock" means a live
				  horse that meets all of the following criteria:
(A) Is or will be eligible to participate in
				  a horseracing contest in California wherein pari-mutuel wagering is permitted
				  under rules and regulations prescribed by the California Horse Racing
				  Board.
(B) Is capable of producing
				  foals which will be eligible to participate in a horseracing contest in
				  California wherein pari-mutuel wagering is permitted under rules and
				  regulations prescribed by the California Horse Racing Board.
(C) Is or was registered with an agency
				  recognized by the California Horse Racing Board and such registering agency
				  does not register the horse as ineligible for breeding stock. Agencies
				  currently recognized are The Jockey Club, The American Quarter Horse
				  Association, The United States Trotting Association, The Appaloosa Horse Club,
				  The Arabian Horse Registry of America, and the American Paint Horse
				  Association.
Racehorse breeding stock does not include any horse over
					 four years old, or five years old in the case of an Arabian horse, that has
					 neither participated in or trained for a horserace contest on which pari-mutuel
					 wagering is permitted, nor been used for breeding purposes in order to produce
					 racehorses.
(4)
				  "Solely" means 100 percent or "only."