Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2014
Sales and Use Tax Annotations
550.0000 TAXABLE SALES OF FOOD PRODUCTS—Regulation 1603
(g) EMPLOYEES', TEACHERS' AND STUDENTS' MEALS
550.1275 Firefighters. The California Department of Forestry and Fire Protection (CDF) requires its firefighters to reside and eat in their fire stations when they are on duty. CDF buys the food products, and cooking duties are performed by the captain or whomever is assigned the function by the employer. Based on the prior years total food cost and number of meals served, CDF determines the average cost per meal, to which sales tax reimbursement is added, and deducts that amount from the firefighter's paychecks. On occasion, other persons eat at the fire stations, but they are apparently not charged for the meal.
CDF is a retailer selling food products in a form for consumption at tables, chairs, counters or from trays, glasses, dishes, or other tableware which it provides. As a result, under Regulation 1603(f), its sales of food products to employees are subject to tax with deduction from their paychecks being a proper method of collecting sales tax reimbursement. CDF must also pay tax on its sales of meals to nonfirefighters at the stations and may collect sales tax reimbursement from those persons by agreement with them. 1/23/80; 2/14/96.