Feed for Feeding Livestock at Public Livestock Markets
Feed to be consumed by livestock at a public livestock market is exempt from
retail sales and use tax.
References: RCW
82.08.0296 and
82.12.0296
Pollen
Pollen is exempt from retail sales and use tax.
References: RCW
82.08.0277 and
82.12.0273
Semen for Use in the Artificial Insemination of Livestock
Semen for use in the artificial insemination of livestock is exempt from
retail sales and use tax.
References: RCW
82.08.0272 and
82.12.0267
Livestock for Breeding Purposes
The sale or use of livestock, as defined in
RCW
16.36.005, for breeding purposes where the animals are registered in a nationally
recognized breed association is exempt from retail sales and use tax. When making
tax-exempt purchases, buyers must provide an exemption certificate to the seller
who is required to keep the certificate on file for a period of five years. (See
the
Farmers'
Retail Sales Tax Exemption Certificate (pdf).)
References: RCW
82.08.0259 and
82.12.0261
Sale of Beef and/or Dairy Cattle for use by a Farmer
Cattle and milk cows used on the farm are exempt from retail sales and use
tax.
References: RCW
82.08.0259 and 82.12.0261
Auction Sales of Farm Property
Retail sales and use taxes do not apply to tangible personal property, including
household goods, which have been used in conducting a farm activity, if the
property was purchased from a farmer at an auction sale held or conducted
by an auctioneer upon a farm.
References: RCW
82.08.0257 and
82.12.0258
Leases of Irrigation Equipment
Retail sales and use taxes do not apply to the lease or use of irrigation
equipment if:
- The irrigation equipment was purchased by the lessor for the purpose
of irrigating land controlled by the lessor;
- The lessor has paid sales or use tax in respect to the irrigation equipment;
- The irrigation equipment is attached to the land in whole or in part;
and
- The irrigation equipment is leased to the lessee as an incidental part
of the lease of the underlying land to the lessee and is used solely on such
land.
References: RCW
82.08.0288 and
82.12.0283
Food Products for Human Consumption
Food products for human consumption are exempt from retail sales and use
tax. This exemption includes livestock sold and/or used for human consumption.
References: RCW
82.08.0293,
82.12.0293,
and
WAC
458-20-244
Dairy Nutrient Management Equipment and Facilities
Sales to, or use by, eligible persons of tangible personal property that becomes
an ingredient or component of dairy nutrient management equipment and facilities
is exempt from retail sales and use tax. The exemption also applies to labor
and services rendered in respect to operating, repairing, cleaning, altering,
or improving dairy nutrient management equipment and facilities. This exemption
became effective July 13, 2001, and applies to sales made, or tangible personal
property or labor and services used, after the dairy nutrient management plan
is certified under chapter
90.64
RCW.
These exemptions are available only if all of the following requirements are met:
- The equipment and facilities must be used exclusively for activities necessary
to maintain a dairy nutrient management plan as required under chapter 90.64
RCW; and
- The buyer provides the seller with an exemption certificate in a form and
manner prescribed by the department which must be retained in the seller's
files. The Department of Revenue will provide an exemption certificate to
an eligible person upon application. A sample
letter (pdf) can be used in applying for an exemption certificate.
For purposes of this exemption, the following definitions apply:
- "Eligible person" means a person licensed to produce milk under
chapter 15.36
RCW who has a certified dairy nutrient management plan by December 31,
2003, as required by chapter 90.64
RCW.
- Dairy nutrient management equipment and facilities" means machinery,
equipment, and structures used exclusively in the handling and treatment
of dairy manure, such as aerators, agitators, alley scrapers, augers, dams,
gutter cleaners, loaders, lagoons, pipes, pumps, separators, and tanks.
The term also includes tangible personal property that becomes an ingredient
or component of the equipment and facilities, including repair and replacement
parts.
References: RCW
82.08.890 and
82.12.890
Animal Pharmaceuticals
Effective August 1, 2001, retail sales and use taxes do not apply to sales to,
or use by, farmers or veterinarians of animal pharmaceuticals approved by the
United States Department of Agriculture (USDA) or by the United States Food and
Drug Administration (FDA). To qualify for the exemption, the pharmaceutical must
be administered to an animal that is raised by a farmer for the purpose of producing
for sale an agricultural product. When making purchases exempt of retail sales
tax, buyers must provide an exemption certificate to the seller who is required
to keep the certificate on file for a period of five years. (See the
Farmers'
Retail Sales Tax Exemption Certificate (pdf).)
The USDA and FDA have an established approval process set forth in federal
regulations. The FDA maintains a list of all approved animal pharmaceuticals
called the "Green Book." The USDA maintains a list of approved biotechnology
products called the "Veterinary Biologics Product Catalogue." Pharmaceuticals
that are not on either of these lists have not been approved and are not eligible
for the exemption.
Sales of products that are used to administer animal pharmaceuticals (e.g.,
syringes) do not qualify for the exemption, even if they are later used to
administer a tax-exempt animal pharmaceutical. However, sales of tax-exempt
animal pharmaceuticals contained in a product used to administer the animal
pharmaceutical (e.g., a dose of a tax-exempt pharmaceutical contained in a
syringe or cotton applicator) do qualify for the exemption.
References: RCW
82.08.880 and
82.12.880
Nonresident Sales of Machinery and Implements
The retail sales tax does not apply to sales to nonresidents of this state
for use outside of this state of:
- Machinery and implements for use in conducting a farming activity;
- Parts for machinery and implements for use in conducting a farming
activity; and
- Labor and services for the repair of machinery, implements, and parts
for use in conducting a farming activity.
To qualify for the exemption, the machinery, implements, and parts must be transported
immediately outside the state. When making tax-exempt purchases, buyers must provide
an exemption certificate to the seller who is required to keep the certificate
on file for a period of five years. (See
the
Farmers' Retail Sales Tax Exemption Certificate (pdf).)
References: RCW
82.08.0268 and
WAC
458-20-239
Agricultural Employee Housing
The retail sales tax does not apply to charges made for labor and services rendered
by any person in respect to the agriculture, repairing, decorating, or improving
of new or existing buildings or other structures used as agricultural employee
housing, or to sales of tangible personal property that becomes an ingredient
or component of the buildings or other structures during the course of the agriculture,
repairing, decorating, or improving the buildings or other structures. Buyers
must provide an exemption certificate to the seller who is required to keep the
certificate on file for a period of five years. (See the
Farmers'
Retail Sales Tax Exemption Certificate (pdf).)
The use tax does not apply to the use of tangible personal property that
becomes an ingredient or component of buildings or other structures used as
agricultural employee housing during the course of agriculture, repairing,
decorating, or improving the buildings or other structures by any person.
These exemptions require that the buildings or other structures be used to house
"agricultural employees," as defined by
RCW
19.30.010, for at least five consecutive years from the date approved for
occupancy. Agricultural employee housing for year-round agricultural employees
must meet the state building code (
chapter
19.27 RCW) for single-family or multi-family dwellings.
These exemptions do not apply to housing built for the occupancy of an agricultural
employer, as defined by
RCW
19.30.10; family members of an agricultural employer; or persons owning stock
or shares in a farm partnership or corporation business.
"Agricultural employee housing" means facilities provided by an
agricultural employer, housing authority, local government, state or federal
agency, nonprofit community or neighborhood-based organization that is exempt
from income tax under section 501(c) of the Internal Revenue Code of 1986,
or for-profit provider of housing for housing agricultural employees. The
facilities must be provided on a year-round or seasonal basis to agricultural
employees. It includes single and multi-family dwellings, and dormitories.
It also includes bathing, food handling, hand washing, laundry, and toilet
facilities. "Agricultural employee housing" does not include housing
regularly provided to the general public on a commercial basis, such as hotels,
motels, apartments, rooming houses, and so forth. Nor does it include housing
provided by a housing authority unless at least 80% of the occupants are agricultural
employees whose adjusted income is less than 50% of median family income,
adjusted for household size, for the county where the housing is provided.
References: RCW
82.08.02745,
82.12.02685,
and
WAC
458-20-262
Warehouse and Grain Elevators and Distribution Centers
Wholesalers or third-party warehousers who own or operate warehouses or grain
elevators and retailers who own or operate distribution centers, and who have
paid the tax on:
- Material-handling and racking equipment, and labor and services rendered
in respect to installing, repairing, cleaning, altering, or improving the
equipment; or
- agriculture of a warehouse or grain elevator, including materials,
and including service and labor costs, are eligible for an exemption from all or part of the state's portion of
the sales tax in the form of a remittance.
References: RCW
82.08.820
Machinery, Equipment, or Structures that Reduce Field Burning
The retail sales tax does not apply to sales of machinery and equipment,
and to services rendered in respect to agriculture structures, installing,
agriculture, repairing, cleaning, decorating, altering, or improving of structures
or eligible machinery and equipment, or to sales of tangible personal property
that becomes an ingredient or component of eligible structures or eligible
machinery and equipment, if the machinery, equipment, or structure is used
more than half of the time:
- For gathering, densifying, processing, handling, storing, transporting,
or incorporating straw or straw-based products that results in a reduction
in field burning of cereal grains and field and turf grass grown for seed;
or
- To decrease air emissions resulting from field burning of cereal grains
and field and turf grass grown for seed.
When making tax-exempt purchases, buyers must provide an exemption certificate
to the seller who is required to keep the certificate on file for a period of
five years. (See the
Farmers'
Retail Sales Tax Exemption Certificate (pdf).)
The use tax does not apply to the use of machinery and equipment, and to
services rendered in respect to installing, repairing, cleaning, altering,
or improving of eligible machinery and equipment, or tangible personal property
that becomes an ingredient or component of eligible machinery and equipment
used more than half of the time:
- For gathering, densifying, processing, handling, storing, transporting,
or incorporating straw or straw-based products that results in a reduction
in field burning of cereal grains and field and turf grass grown for seed;
or
- To decrease air emissions resulting from field burning of cereal grains
and field and turf grass grown for seed.
These exemptions expire January 1, 2006. Persons taking an exemption must
keep records necessary for the Department of Revenue to verify eligibility
for the exemption. Persons who have taken an exemption and then discover that
they do not meet the requirements for the exemption are subject to a deferred
sales tax or use tax liability.
Persons who are eligible for these exemptions may also take a credit against their
B&O tax liability. For more information, see
B&O
tax credit section.
References: RCW
82.08.840 and
82.12.840
Anaerobic Digesters
Retail sales or tax does not apply to sales to, or use by, eligible persons
of anaerobic digesters, nor to services rendered in respect to installing,
agriculture, repairing, cleaning, altering, or improving an anaerobic digester,
nor to the sale or use of tangible personal property that becomes an ingredient
or component of the anaerobic digester. The anaerobic digester must be used
primarily to treat dairy manure.
The retail sales tax exemption is available only when the buyer provides
the seller with an exemption certificate in a form and manner prescribed by
the Department of Revenue. The Department must provide an exemption certificate
to an eligible person upon application by that person. The application must
be in a form and manner prescribed by the Department and must contain information
regarding the location of the facility and other information as the Department
may require.
References: RCW
82.08.900 and
82.12.900
Propane or Natural Gas to Heat Chicken Structures
Retail sales and use taxes do not apply to propane or natural gas used by farmers
to heat structures used to house chickens. The propane or natural gas must be
used exclusively to heat the structures. The structures must be used exclusively
to house chickens that are sold as agricultural products. This exemption became
effective September 20, 2001, and is available only when the buyer provides the
seller with an exemption certificate. (See the
Farmers'
Retail Sales Tax Exemption Certificate (pdf).)
"Structures" are barns, sheds, and other similar buildings in which
chickens are housed.
References: RCW
82.08.910 and
82.12.910
Chicken Bedding Materials
Retail sales and use taxes do not apply to bedding materials used by farmers to
accumulate and facilitate the removal of chicken manure. To qualify for the exemption,
the farmer must be raising chickens that are sold as agricultural products. This
exemption became effective September 20, 2001, and is available only when the
buyer provides the seller with an exemption certificate. (See the
Farmers'
Retail Sales Tax Exemption Certificate (pdf).)
"Bedding materials" are wood shavings, straw, sawdust, shredded
paper, and other similar materials.
References: RCW
82.08.920 and
82.12.920
Poultry
Poultry used in the production for sale of poultry or poultry products is
exempt from retail sales and use tax.
References: RCW
82.08.0267 and
82.12.0262
Fruit/Vegetable Packing Materials
Retail sales and use taxes do not apply to materials and supplies directly used
in the packing of fresh perishable horticultural products by any person who is
entitled to a B&O tax deduction under
RCW
82.04.4287 either as an agent or independent contractor.
References: RCW
82.08.0311 and
82.12.0311,
RCW
82.04.4287