Imperial Valley Press

Chinchilla Squabble Puts New Angle Into Lawbooks as Sales Tax Tested

SACRAMENTO April 9 UPI Superior Judge Peter J. Shields today had under submission a case seeking to determine whether fabulously-priced chinchillas come under state sales tax provisions when they are sold for breeding purposes

Chinchillas command about $3,200 a pair because of their scarcity, and the difficulty in bring them alive from South America

The Chapman Chinchilla Farms at Inglewood contends that purchasers of chinchilla for breeding purposes are not "consumers" as defined in the sales tax laws. Under a favorable decision they would be entitled to a refund of between $30,000 and $40,000 in sales taxes which they have been paying under protest at the rate of between $900 and $1,200 monthly.

Deputy Attorney General Wilmer W. Morse and attorneys for Chapman Farms, Richard Forster and Edward A. Penprase, said the case undoubtedly will be appealed to higher courts regardless of Judge Shields' decision

The case was unique, since there was no legal precedent for chinchillas anywhere in the United States. Seven states have ruled them untaxable, and three have held them taxable

The state board of equalization informally ruled in 1937 the sales tax was not applicable to chinchilla transactions.

Later, the attorney general's office ruled the tax must be paid on breeding animals. The last legislature exempted breeding animals used for human consumption, but no clear-cut action was taken on animals bred for their fur.