Does the retail sales tax exemption apply to electric vehicles with extended range gas generators/motors?
(This article was valid from January 1, 2011 – June 30, 2015. RCW 82.08.809 and 82.12.809 were amended effective July 15, 2015 to expand the exemptions to certain plug-in hybrids. For more information, see our Special Notice.)
The Department of Revenue and the Department of Licensing worked together to look at whether electric vehicles that have additional small gas motors, such as the BMW i3 REx or the Chevrolet Volt, are eligible for the retail sales tax exemption under RCW 82.08.809 for clean alternative fuel vehicles.
To be eligible for the exemption, a vehicle must be “exclusively powered by a clean alternative fuel.” The agencies determined that the term “exclusively powered” refers only to a vehicle’s drive train/method of propulsion because the term “powered” addresses the part of the vehicle directly responsible for propulsion. Therefore, vehicles with an additional gas (or other non-clean alternative fuel) motor that satisfy the elements of the exemption in RCW 82.08.809 and the two requirements listed below will qualify for the retail sales tax exemption:
- The vehicle is subject to the Department of Licensing’s Electric Vehicle Registration Fee, under RCW 46.17.323.
- The non-clean alternative fuel motor does not power the vehicle’s drive train.
The BMW i3 REx meets both of these requirements and, therefore, qualifies as “exclusively powered by a clean alternative fuel” eligible for the exemption. The term “powered” addresses the part of the vehicle directly responsible for its propulsion.
The Chevrolet Volt, however, is not eligible for the retail sales tax exemption because it is not subject to the electric vehicle registration fee under RCW 46.17.323 and its gas motor powers the vehicle’s drive train at certain levels of battery depletion.
For a list of vehicles that are subject to the Electric Vehicle Registration Fee under RCW 46.17.323, please visit the West Coast Electric Highway website and select the Resources tab.