Legal Question in Tax Law in California

Taxation on Freight Charges

I need clarification on how freight charges are taxed. I need a general answer, not necessarily specific to California Code. What is the difference when frieght is classified as Free-On-Board (FOB) destination or FOB origin? If the shipping is state-to-state and it is FOB destination, does that mean the the destination state's laws determine if the freight cost is shipped?


Asked on 6/21/00, 3:05 pm

1 Answer from Attorneys
Christopher Enge Law Offices of Christopher J. Enge

Re: Taxation on Freight Charges

FOB, CIF, and C&F don't refer to taxes, but rather to responsibility for the risk of loss. FOB destination means that the title to the goods passes when the cargo is delivered to the destination. In other words, the seller owns the goods until delivered. In contrast, FOB origin means that the buyer owns the goods once the seller ships them from the point of origin. I have a chart I can send you outlining the various terms of sale, which I can mail you if you contact me. I hope this helps.

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Answered on 8/31/00, 4:12 pm


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