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Sales tax
Businesses that sell retail products or provide retail services in Washington must collect sales tax from their customer. The sales tax must be submitted to the Department of Revenue, even if it is not collected.
Sales tax is made up of the state rate (6.5%) and the local sales tax rate. The local sales tax rate varies depending on the location of the sale.
Use tax
Use tax is a tax on the use of products or services in Washington when sales tax has not been paid. Use of products or services in this state are subject to either sales or use tax, but not both on the same transaction. Therefore, when retail sales tax is paid on products or services, the sale is not subject to use tax.
Use tax is made up of the state rate (6.5%) and the local sales tax rate. The local sales tax rate varies depending on the location of the sale.
How to determine the correct rates for sales or use tax
The type of sale and location of delivery for the product or service determines the sales or use tax rate.
For: |
The tax rate is determined by: |
| Sales of tangible personal property | The location where the customer receives the merchandise. |
| Retail services, such as, construction, installation work, hotels, and physical fitness services | The location where the services are primarily performed. |
| Rentals or leases | Payment arrangement:
|
Sales of the following products:
|
The business location of the seller from which delivery is made. |
There are tools dedicated to helping businesses determine the correct sales or use tax rate. Sales or use tax rates may change quarterly so be sure to review rates on a quarterly basis.
Other applicable taxes
In addition to sales or use tax, other taxes may apply to sales of certain retail products or retail services.
References
WAC 458-20-145 – Sourcing retail sales
