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 17 - Payment and Collection of Use Tax › Section 1684 - Collection of Use Tax by Retailers. [Effective Until at Least 9-15-2012; See History Note for New Version of Section 1684 for Details]

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a)
				  Retailers Engaged in Business in State. Retailers engaged in business in this
				  state as defined in Section
				  6203
				  of the Revenue and Taxation Code and making sales of tangible personal
				  property, the storage, use, or other consumption of which is subject to the tax
				  must register with the Board and, at the time of making the sales, or, if the
				  storage, use or other consumption of the tangible personal property is not then
				  taxable, at the time it becomes taxable, collect the tax from the purchaser and
				  give the purchaser a receipt therefor.
Any retailer deriving rentals from a lease of tangible
					 personal property situated in this state is a "retailer engaged in business in
					 this state" and is required to collect the tax at the time rentals are paid by
					 his lessee.
The use of a computer server on the Internet to create or
					 maintain a World Wide Web page or site by an out-of-state retailer will not be
					 considered a factor in determining whether the retailer has a substantial nexus
					 with California. No Internet Service Provider, On-line Service Provider,
					 internetwork communication service provider, or other Internet access service
					 provider, or World Wide Web hosting services shall be deemed the agent or
					 representative of any out-of-state retailer as a result of the service provider
					 maintaining or taking orders via a web page or site on a computer server that
					 is physically located in this state.
A retailer is not "engaged in business in this state" based
					 solely on its use of a representative or independent contractor in this state
					 for purposes of performing warranty or repair services with respect to tangible
					 personal property sold by the retailer, provided that the ultimate ownership of
					 the representative or independent contractor so used and the retailer is not
					 substantially similar. For purposes of this paragraph, "ultimate owner" means a
					 stock holder, bond holder, partner, or other person holding an ownership
					 interest.
(b) Convention and
				  Trade Show Activities. For purposes of this subdivision, the term "convention
				  and trade show activity" means any activity of a kind traditionally conducted
				  at conventions, annual meetings, or trade shows, including, but not limited to,
				  any activity one of the purposes of which is to attract persons in an industry
				  generally (without regard to membership in the sponsoring organization) as well
				  as members of the public to the show for the purpose of displaying industry
				  products or to stimulate interest in, and demand for, industry products or
				  services, or to educate persons engaged in the industry in the development of
				  new products and services or new rules and regulations affecting the industry.
Except as provided in this paragraph, a retailer is not
					 "engaged in business in this state" based solely on the retailer's convention
					 and trade show activities provided that:
(1) For the period commencing on January 1,
				  1998 and ending on December 31, 2000, the retailer, including any of his or her
				  representatives, agents, salespersons, canvassers, independent contractors, or
				  solicitors, does not engage in those convention and trade show activities for
				  more than seven days, in whole or in part, in this state during any 12-month
				  period and did not derive more than ten thousand dollars ($10,000) of gross
				  income from those activities in this state during the prior calendar
				  year;
(2) For the period commencing
				  on January 1, 2001, the retailer, including any of his or her representatives,
				  agents, salespersons, canvassers, independent contractors, or solicitors, does
				  not engage in those convention and trade show activities for more than fifteen
				  days, in whole or in part, in this state during any 12-month period and did not
				  derive more than one hundred thousand dollars ($100,000) of net income from
				  those activities in this state during the prior calendar year.
A retailer coming within the provisions of this subdivision
					 is, however, "engaged in business in this state," and is liable for collection
					 of the applicable use tax, with respect to any sale of tangible personal
					 property occurring at the retailer's convention and trade show activities and
					 with respect to any sale of tangible personal property made pursuant to an
					 order taken at or during those convention and trade show
					 activities.