Can You Tax Me Now? Court to Verizon Affiliate: Yes!

Are materials such as telephone cables held for resale to affiliates who install them exempt from state sales and use tax?

The California Court of Appeals ruled no, after interpreting the word “line,” in a Sept. 24 decision involving a Verizon affiliate.

Verizon Business Purchasing LLC (Verizon) appealed a ruling in favor of the California Department of Tax and Fee Administration. The appeals court upheld the trial’s court ruling that Verizon’s cables were pre-installation components, not actual lines, and therefore aren’t exempt from sales tax.

Verizon purchases electrical equipment for internal resale, operating as a subsidiary of Verizon Business Network ...