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California
Use Tax Requirements Changed
July
1, 2007 for
Purchases of Vessels
On
July 1, 2007, California use tax requirements changed
for vessels purchased outside this state and brought
into California.
When
does a buyer owe tax on an out-of-state purchase of
a vessel?
As
of July 1, 2007, buyers of vessels generally owe California
use tax when they:
- Buy
a vessel outside California and bring it into this
state within 90 days
Are
there exceptions?
Yes.
The buyer generally will not owe use tax if the vessel
is used outside California more than one-half of the
time in the first six months after it is brought into
this state.
What
changed July 1?
Between
October 2, 2004 and June 30, 2007, use tax was generally
due if the buyer brought the vessel into California
within 12 months of purchase. On or after July 1, 2007
it is within 90 days of purchase.
Who
collects the tax?
The
Department of Motor Vehicles collects the use tax at
the time of registration on vehicles and undocumented
vessels. California's Consumer Use Tax Section collects
the use tax on vessels documented with the United States
Coast Guard.
What
is the reason for the change?
In
2004, Senate Bill 1100 temporarily amended Revenue and
Taxation Code section 6248. That temporary change expired
on June 30, 2007.
For
more information
Information
on use tax due on purchases of vessels in found on the
California State Board of Equalization's website at
http://www.boe.ca.gov/sutax/faqscont.htm.
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