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 7 - Specific Kinds of Property and Exemptions Generally › Section 1585 - Cellular Telephones, Pagers, and Other Wireless Telecommunication Devices

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a)
				  Definitions.
(1) Wireless Telecommunication
				  Device. A portable communication device such as a wireless telephone or pager
				  requiring activation by a wireless telecommunications service provider or
				  seller of utility services in order to send, receive, or send and receive
				  transmissions via a network of wireless transmitters throughout multiple
				  service areas, or otherwise. The term includes devices based on analog
				  technology and devices based on digital technology.
(2) Wireless Telecommunications Service
				  Provider. A utility regulated by the Public Utilities Commission or the Federal
				  Communications Commission which offers or provides wireless communication or
				  paging services.
(3) Bundled
				  Transaction. The retail sale of a wireless telecommunication device which
				  contractually requires the retailer's customer to activate or contract with a
				  wireless telecommunications service provider for utility service for a period
				  greater than one month as a condition of that sale. A transaction is a bundled
				  transaction within the meaning of this regulation without regard to the method
				  in which the price is stated to the customer. Also, it is immaterial whether
				  the wireless telecommunication device and utility service are sold for a single
				  price or are separately itemized in the context of a sale or on a sales
				  invoice. A transaction is a bundled transaction if goods and services are sold
				  as a single package, whether wireless telecommunication service is supplied to
				  the customer by the retailer or by an independent service supplier. In such
				  transactions, wireless devices may be sold at a "discounted" price, as an
				  inducement for the customer to enter into an extended service contract. The
				  fact that a wireless telecommunication device, such as a PCS (Personal
				  Communication Service) telephone, may, because of its technological
				  specifications, be subject to activation with only one service supplier, does
				  not alone mean that the sale of the device will be treated as a bundled
				  transaction.
(4) Unbundled Sales
				  Price. The price at which the retailer has sold specific wireless
				  telecommunication devices to customers who are not required to activate or
				  contract for utility service with the retailer or with an independent wireless
				  telecommunications service provider for utility service as a condition of that
				  sale. If the retailer cannot establish an unbundled sales price to the
				  satisfaction of the Board based upon its own sales records, the unbundled sales
				  price of the device shall equal the fair retail selling price of that device.
				  If tax is reported and paid on an amount equal to the cost of the device plus a
				  markup on cost of at least 18 percent, such amount shall be regarded as the
				  fair retail selling price of the device. The unbundled sales price of an
				  obsolete wireless telecommunication device shall equal the actual selling price
				  of that device.