Bowne of Los Angeles, Inc. v. City of Los Angeles

The city appeals from an adverse judgment in an action for a refund of taxes allegedly improperly assessed and paid. We affirm the judgment in favor of the taxpayer.

Plaintiff is a printer of specialized financial documents. Its product, on directions from the clients, is distributed by it to three groups of persons: (1) to the client in Los Angeles; (2) to offices of the client in other states; and (3) to sundry stockbrokers, underwriters, accounting firms and the Securities and Exchange Commission, as directed by the client. The client pays plaintiff for all copies of the printed material, whether delivered to it in Los Angeles, to its offices in other states, or to the other recipients designated by the client.

The City of Los Angeles imposes a business license tax on such businesses as that of plaintiff, measured by the gross receipts from its operations (L. A. Mun. Code, §§ 21.166, 21.167). However, section 21.168.1 exempts from that tax “the gross receipts of the sales of goods which are shipped to the *32 purchasers of such goods by the seller to points outside the State of California.”

It is here conceded that plaintiff is properly taxable on the portion of the…