Parking fees

If you pay sales tax where you park your car every day and your friend, who parks at another location doesn't, you may wonder what the difference is. Whether sales tax is due depends on:

• The duration of your parking agreement.
• If you have an assigned parking spot.

Hourly metered parking

Parking fees for hourly parking in garages or parking lots are subject to sales tax. It makes no difference whether the parking structure is owned by the local government or a private company. It also makes no difference if the lot is attended or unattended.

If you park at an attended lot or garage, the posted hourly charges may state that sales tax is included in the price. This indicates the amount you pay includes both the selling price and the retail sales tax. For more information, see our Tax Topic article titled Advertising - Tax Included in the Price.

If you park at an unattended lot or garage and “feed” money into a meter or box, the lot operator can back the tax out of the total amount. It doesn’t matter if the lot is attended or not, the owner will pay Retailing business and occupation (B&O) tax and sales tax on the parking charge received.

City/county metered parking

Sales tax does not apply to metered parking on streets owned by the city or county. Meters are traffic regulation devices, managed by the city or county. As a result, parking fees collected by the city for on-street metered parking and on-street parking permits are not subject to B&O or sales tax. (For more information, see WAC 458-20-189.)

Monthly parking

Sales tax does not apply if you rent a designated parking space for your own personal use for 30 days or longer. Such parking is considered a rental of real estate and is not subject to sales tax or B&O tax.

Note: If you lease assigned parking spaces for 30 days or longer from the federal, state, local or tribal government, leasehold excise tax would apply.

Sales tax is due if you pay for monthly parking and don’t have an assigned space or stall. Your ability to park may be limited to a certain floor or number of spaces. This is not a designated space for your exclusive use. Consequently, the rental is not a rental of real estate and the parking business must collect sales tax. In addition, the parking business owes B&O tax under the retailing classification.

For more information about the taxability of parking fees, see WAC 458-20-118 and ETA 3030.2009.