For Immediate Release
December 2, 2002
Although California is
taxpayer friendly regarding sales tax exemptions on labor charges, the
State Board of Equalization warns that not all labor is exempt.
Fabrication labor and services relating to taxable sales are taxable,
regardless of whether or not the labor charges are separately stated.
In addition, fabrication labor is taxable regardless of who provides the
materials, the seller or the customer.
In general, California’s sales tax exemption applies to labor or
services related to a nontaxable sale, charges for installation, and itemized
charges for repair labor. Sales tax does apply to charges for parts used
in the repair, if the parts are separately stated or the retail value
of the parts exceeds 10% of the total charges.
If you would like additional information or have any questions, please
contact J. Lynne Fontana, Regional Vice President - Sales & Use Tax
Group at (281)578-3700. E-mail lfontana@thesaltgroup.com
The HJH Consulting Group Plaza | 874 Harper Road | Suite 101 | Kerrville, Texas 78028 | 830.257.1290 | Fax 830.257.2138
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