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Home>Levelset Community>Legal Help>Supplier sends material to Cali, we only plan to store it and ship to Tawain when site is ready. DO we pay taxes

Supplier sends material to Cali, we only plan to store it and ship to Tawain when site is ready. DO we pay taxes

California

We are a GC with a job in Tawain, but the site is not ready for use. We had our supplier ship to CA until we could ship out of the country when the site was ready. Do we pay taxes on that original shipment even though the material is going out of state?

1 reply

Aug 1, 2022

You will likely have to pay a use tax. The CA Revenue and Taxation Code imposes that on goods that are stored (see RTC 6202). Taxation is very complicated - if you planning to do this for a large amount of materials then we can write up a memorandum for you about it to help you choose the strategy with the lowest tax impact.

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