FET is federal excise tax - has nothing to do with state of registration or operation. Sales tax is a completely different deal. As far as I know there is no way to avoid FET on new equipment but there are ways to avoid state sales tax based on where you title the trailer.
Do you pay FET on a new trailer?
Discussion in 'Ask An Owner Operator' started by 77fib77, Dec 14, 2019.
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The dealership would have collected the fet....... this must be a CA state tax thing.
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FET is 12% CA sales tax 8+% depending where you live.
That's around 20%. If you paid $35000 for the trailer $7000 in taxes is about right.
You can't avoid FET, but you can avoid CA sales tax if you do your research before the purchase.
What's done is done. Keep on trucking.Oxbow Thanks this. -
Here is what you need to know about California sales/use tax:
APPENDIX 4 Vehicles and Undocumented Vessels Purchased for Use in Interstate and Foreign Commerce.
The following information applies to the purchase and registration of vehicles (including trailers) or undocumented vessels that are intended for use in interstate or foreign commerce. If the property is a vehicle, use tax will not apply if one-half or more of the miles traveled by the vehicle during the six month period immediately following its entry into this state are commercial miles traveled in interstate or foreign commerce. If the property is a vessel, use tax will not apply if one-half or more of the nautical miles, traveled by the vessel during the six-month period immediately following its entry into the state are commercial miles traveled in interstate or foreign commerce. To support an interstate and foreign commerce exemption, the following documentary evidence must be retained:
1. Verification of delivery outside the State of California;
2. Verification that the first functional use of the vehicle or vessel was outside of California prior to its initial entry into California. “First functional use” of a commercial vehicle or vessel generally occurs when the vehicle or vessel is first used to carry cargo or passengers, or when the vehicle or vessel is dispatched to pick up a specific load of cargo or group of passengers;
3. Documentation that establishes the date the vehicle or vessel initially entered California; and
4. Documentation that validates the location and/or use of the vehicle or vessel from the out-of-state delivery date through the qualifying period; the date the vehicle/vessel initially entered California and for the subsequent six months. If a vehicle or vessel initially enters California deadheaded (without a load or passengers) and not dispatched to pick up a load of cargo or passengers, the first functional use will be considered to have taken place in California. Please note: Sailing in part on the high seas while traveling to and from California ports does not, by itself, qualify a vessel for the exemption. To be considered as a trip in interstate or foreign commerce, the vessel must actually enter another state or country. The fact that a vessel travels outside of the three mile limit and back into California is not considered to be interstate or foreign commerce. -
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77fib77 Thanks this.
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