City, County, State Governments
Are sales to city, county or Washington state government exempt from retail sales tax?
The retail sales tax is due on sales of vehicles to the state of Washington, its departments and institutions and to counties, cities, school districts and all other municipal subdivisions of the state.
Are there any exceptions?
Yes. Vehicles loaned to and used for driver education by schools.
See Driver Education Vehicles and Ride Sharing Vehicles.
Reference
Washington Administrative Code (WAC) 458-20-189
United States Government
What constitutes a sale to the federal government?
The sale of a vehicle must be made directly to the United States, its departments, institutions and instrumentalities, or agencies directly operated and controlled by the federal government for the benefit of the general public. See list below.
Sales to institutions which have been chartered or created under federal authority which are not directly operated and controlled by the government for the benefit of the general public are not considered sales to the federal government.
Sales to representatives or employees for own use
Sales to persons in the Army, Navy or Air Force of the United States, including civilian employees in such service, are not exempt from the retail sales tax. See Military.
No exemption is permitted for sales to or by voluntary unincorporated organizations of Army or Navy personnel which are not instrumentalities of the United States, national banking associations, persons licensed to engage in private businesses under federal statutes, or contractors engaged in performing contracts for the United States government.
Likewise, the retail sales tax applies to sales made to the Washington State Department of Social and Health Services, Employment Security Department and Department of Health, even when those departments are reimbursed with federal funds.
B&O tax
No deductions are allowed from the B&O tax for business transacted with the United States, its departments, institutions or instrumentalities.
Retail sales tax
Direct purchases by the federal government are exempt from the retail sales tax, but purchases by others, whether with federal funds or through a reimbursement arrangement, are fully subject to the retail sales tax. Sales to federal employees or representatives of the federal government are subject to sales tax, even though the federal government may reimburse them for all or a part of such expenses.
United States Government Departments, Instrumentalities and agencies
Agriculture
Commerce
Interior (Including Bonneville Power Administration and the
Tennessee Valley Authority)
Justice |
Labor
Post Office
State
Treasury
National Military Establishment (Army, Navy and Air Force) |
Agencies congressionally exempt by establishment or specific statutory exemption
Central Banks for Cooperatives (if stock is owned by the United States)
Civil Service Commission
Export-import bank
Farm Credit Administration
Farm credit banks
Farm Loan Association
Federal Deposit Insurance Corporation
Federal Home Loan Banks
Federal Home Loan Mortgage Corporation
Federal Housing Administration (including Housing and Urban Development)
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Federal Land Banks
Federal National Mortgage Association
Federal Reserve Banks
Federal Savings and Loan Insurance Corporation
Federally Chartered Credit Unions
Government National Mortgage Association
Home Owner's Loan Corporation
Rural Electrification Administration
Social Security Board
United States Maritime Commission
Veteran's Administration |
References
Washington Administrative Code (WAC) 458-20-190
Washington Administrative Code (WAC) 458-20-177
Foreign Governments and Diplomats
Foreign diplomats
Ambassadors or foreign consuls are exempt from the retail sales tax, with limitations. Diplomatic tax exemption cards are issued by the U.S. Department of State. There are two types of cards: a Mission Tax Exemption Card (issued to individuals making purchases on behalf of the mission) and a Personal Tax Exemption Card (issued to individuals making personal purchases).
Please note that exemption under this program may not apply to all types of purchases. (See below for procedures for purchasing vehicles under this program.) A colored stripe on the card identifies the level of exemption. Sellers should be aware of the restriction to this exemption program before making an exempt sale.
See Diplomatic Tax Exemption Program for more information.
Purchase of vehicles under the Diplomatic Tax Exemption Program
Sellers must follow these procedures when authorizing a diplomatic tax exemption on the purchase of a vehicle:
1. The seller is required to examine and retain a copy of the purchaser's Mission Tax Exemption Card, Personal Tax Exemption Card, or Protocol Identification Card as proof that the purchaser is a diplomatic agent or is authorized to make official purchases on behalf of a diplomatic mission. Due to reciprocity, some diplomatic agents who are not eligible for a tax exemption card may be eligible for exemption from taxes on vehicles. In this event, the seller must examine and keep a copy of the diplomatic agent's protocol identification card.
2. Before completing the sale and allowing the tax exemption, the seller must contact the U.S. State Department (Office of Foreign Missions) for approval or denial of the tax exemption. The seller may call the Washington, D.C. office at (202) 895-3563 or the San Francisco office at (415) 744-2910.
3. The Office of Foreign Missions will provide the seller with a letter stating if the purchaser is eligible for a sales or use tax exemption. If the tax exemption is denied, the purchaser must pay the sales tax to the seller and proof of payment must be sent to the Office of Foreign Missions. This amount will be credited against the federal surcharge imposed by the U.S. State Department at the time the vehicle is registered with the Office of Foreign Missions as required by federal law.
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