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Politics : Stockman Scott's Political Debate Porch -- Ignore unavailable to you. Want to Upgrade?

To: Wharf Rat who wrote (8700)	11/1/2002 11:43:59 AM
From: jjkirk	Read Replies (1) \| Respond to of 89467

Here's more than you ever wanted to know about it...jj Regulation 1599. (Continued) 1 State of California BOARD OF EQUALIZATION SALES AND USE TAX REGULATIONS Regulation 1599. COINS AND BULLION. Reference: Sections 6007, 6008, 6009, 6011, 6354, 6355, Revenue and Taxation Code. (a) GENERAL. (1) SALES OF COINS. The transfer of coins for use solely as a medium of exchange, i.e., as legal tender, is not subject to tax even though the transferee pays an amount exceeding the face amount. For example, tax does not apply to a transaction whereby a coin changer returns only 95 cents on a dollar. On the other hand, tax does apply to sales of coins as collector's items or as an investment, except as otherwise specified in this regulation. (2) SALES OF GOLD OR SILVER BULLION. Tax applies to sales of gold or silver bullion except as provided in subdivision (a) (3) below. (3) SALES IN BULK OF MONETIZED BULLION, NONMONETIZED GOLD OR SILVER BULLION, AND NUMISMATIC COINS. Sales in bulk of "monetized bullion," nonmonetized gold or silver bullion, and numismatic coins which sales are substantially equivalent to transactions in securities or commodities through a national securities or commodities exchange, are exempt from both the sales tax and the use tax. The exemption for sales in bulk of nonmonetized gold or silver bullion and numismatic coins is effective with respect to sales occurring on and after January 1, 1986. "Monetized bullion" means coins or other forms of money manufactured of gold, silver, or other metal and heretofore, now, or hereafter used as a medium of exchange under the laws of this state, the United States, or any foreign nation. The medium of exchange must have had a legal status equivalent to legal tender. Effective September 28, 1983, "monetized bullion" includes gold medallions struck under authority of the American Arts Gold Medallion Act (Title IV of Public Law 95-630). Nonmonetized bullion means gold or silver which has been smelted or refined and has a value dependent primarily upon its gold or silver content and not upon its form. Neither the sales tax nor the use tax applies to sales of "monetized bullion," nonmonetized gold or silver bullion, and numismatic coins provided the following conditions are met: (A) The sale is in bulk amount. A sale in bulk occurs if the total market value of the monetized bullion, nonmonetized gold or silver bullion, and numismatic coins sold in a single transaction is $1,000 or more or is equal to or exceeds the adjusted amount as computed by Revenue and Taxation Code Section 6355. For purposes of this regulation, market value means sales price as defined in Section 6011 of the Sales and Use Tax Law. (B) The sale is by or through a person registered pursuant to the Commodity Exchange Act (7 U.S.C. Sec. 1 et seq.) or not required to be registered under the Commodity Exchange Act. (4) SALES OF COMMEMORATIVE "CALIFORNIA GOLD" MEDALLIONS. Effective September 27, 1985, tax does not apply to the sale of or the storage, use, or other consumption in this state of commemorative "California Gold" medallions produced and sold in accordance with Chapter 25 (commencing with Section 7551) of Division 7 of Title 1 of the Government Code. (b) APPLICATION OF TAX TO SPECIFIC TYPES OF TRANSACTIONS. (1) OPTIONS TO BUY. "Options to buy" are contracts in which the seller agrees to sell specified property, usually at a predetermined price, while the buyer obtains the right but not the duty to purchase the property. Accordingly, the "buyer" has the option to purchase the property but may decide not to purchase without breaching the contract. A sale happens if the buyer exercises his or her option to purchase the property and tax applies at the time the option is exercised unless the sale is otherwise exempt. On the other hand, if the option is not exercised, no sale happens and no tax applies.