This tax guide was written to help farmers understand their tax liability in the state of Washington. For additional information or answers to any questions about Washington excise taxes, please contact us.

>> For a printable version (PDF), click here.

Please note the following changes:

• For periods beginning January 1, 2004, through June 30, 2005, wineries may qualify for a preferential business and occupation (B&O) tax rate and may qualify for a refund of the B&O tax paid that exceed the preferential rate. For periods beginning July 1, 2005, wineries may qualify for an exemption from the B&O tax and may qualify for a refund of the B&O tax paid. For more information, read our Special Notice.
  
• Effective August 1, 2007, a B&O tax exemption for certain custom farming services, and for other farming-related services and agricultural hauling activities between related persons is available. For more information, read our Special Notice.
• Effective July 1, 2006, a sales and use tax exemption for replacement parts for farm machinery and equipment is available. For more information, read our Special Notice.
• Effective July 1, 2006, tax exemptions for livestock nutrient management equipment and facilities are available. For more information, read our Special Notice.
• Effective March 6, 2006, a sales and use tax exemption for diesel fuel or aircraft fuel is available. Effective May 11, 2007, the exemption is also available for biodiesel fuel. For more information, read our Special Notice.
• Effective July 1, 2005 tax incentives to reduce agricultural burning has changed. For more information, read our Special Notice.
  
  

Table of Contents

• Common Terms
• Overview of Taxes Applying to Farming
• Sales of Goods to Farmers
• Providing Services to Farmers
• Farmers' Use Tax Obligation
• Specific Activities of Farmers
• >  Plantation Christmas Trees
• >  Short Rotation Hardwoods
• >  Public Markets - Roadside Stands
• >  Feedlots
• >  Nurseries
• >  Turf Farmers
• >  Shellfish or Other Aquatic Products
• >  Farmers Using Agricultural Products in a Manufacturing Process
• >  Hauling
• >  Compression or Cubing of Hay
• >  Pollination
• >  Cold Storage
• >  Seed Furnished Under Grower Contracts
• B&O Tax Exemptions
• Sales and Use Tax Exemptions
• Credits
• Special B&O Tax Classifications

Additional Resources

Guidelines for the Agricultural Burning Exemption (pdf)

Tax Incentives to Reduce Agricultural Burning have Changed  (pdf)

>> Updated - Fall 2006