82.04.050(3,e) HORTICULTURAL SERVICES FOR FARMERS
Purpose: To support the agricultural industry.
Category/Year Enacted: Agriculture; 1993.
Primary Beneficiaries: Agricultural producers.
Conflict With Other Programs: None evident.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 5,037 | 5,037 | 5,037 | 5,037 |
| Local taxes | 1,085 | 1,085 | 1,085 | 1,085 |
If the exemption were repealed, would the estimated revenue be realized? Yes.
82.04.050(8) FEED AND SEED
Purpose: The purpose may originally have been to provide economic relief to a distressed sector of the economy.
Category/Year Enacted: Agriculture; 1935 (seed added in 1943).
Primary Beneficiaries: Agricultural producers.
Conflict With Other Programs: None evident.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 46,220 | 47,140 | 48,090 | 49,050 |
| Local taxes | 10,000 | 10,150 | 10,360 | 10,560 |
If the exemption were repealed, would the estimated revenue be realized? Yes.
82.04.050(8) FERTILIZER & CHEMICAL SPRAY
Purpose: To assist an economically distressed industry. Also, it can be argued that fertilizer and spray are similar to component parts, if they are actually absorbed into the product that is being produced.
Category/Year Enacted: Agriculture; 1943.
Primary Beneficiaries: Agricultural producers.
Conflict With Other Programs: None evident.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 41,430 | 43,500 | 45,680 | 47,960 |
| Local taxes | 8,920 | 9,370 | 9,840 | 10,330 |
If the exemption were repealed, would the estimated revenue be realized? Yes.
82.04.050(8) POLLINATION AGENTS
Description: This exemption pertains to bees which are purchased by farmers for pollination purposes. (Most pollination is done with honey bees which are rented to farmers by bee keepers, but such rental is not subject to sales tax.) Leaf-cutter bees are the principal pollination agents that are purchased.
Purpose: To aid a segment of the agricultural sector and make the tax treatment uniform with other forms of pollination.
Category/Year Enacted: Agriculture; 1993.
Primary Beneficiaries: Farmers that use leaf-cutter bees for pollination.
Conflict With Other Programs: None evident.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 18 | 18 | 18 | 20 |
| Local taxes | 4 | 4 | 4 | 5 |
If the exemption were repealed, would the estimated revenue be realized? Yes.
82.04.050(8) CONSERVATION & HABITAT DEVELOPMENT
Description: This exemption pertains to sales of feed, seed, fertilizer and spray materials to landowners that participate in specified federal conservation and habitat protection programs or under a cooperative habitat agreement with the Washington State Department of Fish & Wildlife.
Purpose: To encourage land conservation and protection of wildlife habitat.
Category/Year Enacted: Agriculture; 1997.
Primary Beneficiaries: Farmers and other landowners.
Conflict With Other Programs: None evident.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 22 | 35 | 47 | 47 |
| Local taxes | 6 | 9 | 12 | 12 |
If the exemption were repealed, would the estimated revenue be realized? Yes.
82.04.213 CHRISTMAS TREE PRODUCTION
Description: Items purchased for the production of plantation Christmas trees are exempt from retail sales/use tax because plantation Christmas trees are included in the definition of "agricultural products" in RCW 82.04.213 and items used in their production are excluded from the definition of "retail sale" in RCW 82.04.050(7).
Purpose: This exemption recognizes that production of Christmas trees is similar to other agricultural activities, thereby warranting exemption of materials used in production.
Category/Year Enacted: Agriculture; 1987.
Primary Beneficiaries: Growers of plantation Christmas trees.
Conflict With Other Programs: None evident.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 517 | 573 | 602 | 632 |
| Local taxes | 119 | 132 | 139 | 146 |
If the exemption were repealed, would the estimated revenue be realized? Yes.
82.08.0257 FARM AUCTION SALES
82.12.0258
Description: Sales of tangible personal property that were used in a farm activity (e.g., farm machinery and implements) sold through auctioneers, if the seller is a farmer and the sale is held on a farm are exempt from sales tax. Most such sales occur due to bankruptcy.
Purpose: The purpose is apparently part of legislative policy to aid the agricultural sector, especially when the auction is due to bankruptcy.
Category/Year Enacted: Agriculture; 1943.
Primary Beneficiaries: Farmers who sell personal property at farm auctions.
Conflict With Other Programs: Yes; sales of similar property by farm equipment dealers are taxable.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 215 | 215 | 215 | 215 |
| Local taxes | 50 | 50 | 50 | 50 |
If the exemption were repealed would the estimated revenue be realized? Yes.
82.08.0259 BREEDING LIVESTOCK & CATTLE
82.12.0261
Description: Sales of purebred livestock for breeding purposes, and sales of cattle and milk cows used on a farm are exempt from the sales tax.
Purpose: This part of a series of exemptions supporting the agricultural industry.
Category/Year Enacted: Agriculture; 1945.
Primary Beneficiaries: Sellers and buyers of purebred livestock, cattle, and milk cows.
Conflict With Other Programs: None evident.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 4,897 | 5,044 | 5,195 | 5,352 |
| Local taxes | 1,130 | 1,164 | 1,199 | 1,235 |
If the exemption were repealed, would the estimated revenue be realized? Yes.
82.08.0267 POULTRY
82.12.0262
Description: Sales of poultry for use in production of poultry or poultry products are exempt from the sales tax.
Purpose: This part of a series of exemptions constituting legislative policy to support agriculture.
Category/Year Enacted: Agriculture; 1961.
Primary Beneficiaries: Sellers and buyers of poultry for production.
Conflict With Other Programs: None evident.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 1,587 | 1,635 | 1,684 | 1,734 |
| Local taxes | 366 | 377 | 388 | 400 |
If the exemption were repealed, would the estimated revenue be realized? Yes.
82.08.0272 SEMEN
82.12.0267
Description: The sale of semen used for artificial insemination of livestock is exempt from the retail sales/use taxes.
Purpose: The primary intent of this exemption is to lower the cost of production to the producer and is part of a number of exemptions constituting legislative policy in support of agriculture. An argument could also be made that such products constitute component parts of other products being produced for sale.
Category/Year Enacted: Agriculture; 1965.
Primary Beneficiaries: The primary beneficiaries of this exemption are the ranchers who purchase semen for artificial insemination of livestock.
Conflict With Other Programs: None evident.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 239 | 239 | 239 | 239 |
| Local taxes | 55 | 55 | 55 | 55 |
If the exemption were repealed, would the estimated revenue be realized?
Perhaps; unless the courts rule that semen be considered as a component part.
82.08.02745 FARM-WORKER HOUSING
82.12.02685
Description: Exemption from sales and use tax is provided for goods and services used in construction, repairing or improving of new or existing structures used for housing of temporary farm workers. Ownership of the facilities may be by agricultural employers, governmental entities, nonprofit organizations or for-profit housing providers.
Purpose: To encourage construction of housing for temporary farm workers.
Category/Year Enacted: Agriculture; 1996.
Primary Beneficiaries: Owners of housing for temporary farm workers.
Conflict With Other Programs: None evident.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 624 | 624 | 624 | 624 |
| Local taxes | 163 | 163 | 163 | 163 |
If the exemption were repealed, would the estimated revenue be realized? Yes.
82.08.0277 POLLEN
82.12.0273
Description: Sales of pollen are exempt from the sales tax.
Purpose: This part of a legislative policy to support the agricultural and horticultural sectors.
Category/Year Enacted: Agriculture; 1967.
Primary Beneficiaries: Sellers and buyers of pollen.
Conflict With Other Programs: None evident.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 21 | 21 | 21 | 21 |
| Local taxes | 5 | 5 | 5 | 5 |
If the exemption were repealed, would the estimated revenue be realized?
Yes, unless pollen were considered as a component part.
82.08.0288 LEASED IRRIGATION EQUIPMENT
82.12.0283
Purpose: The primary purpose is to avoid double taxation. Normally, persons who lease tangible personal property pay sales tax but the owner is exempt from sales tax upon the original acquisition because the item is being purchased for resale.
Category/Year Enacted: Agriculture; 1983.
Primary Beneficiaries: Lessees of farm land which include leased irrigation equipment.
Conflict With Other Programs: None evident.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 5,800 | 5,940 | 6,120 | 6,304 |
| Local taxes | 1,330 | 1,370 | 1,410 | 1,450 |
Unlikely, because of the resulting double taxation.
82.08.0294 FISH FEED FOR AQUACULTURE
82.12.0294
Description: Persons who raise fish for sale at wholesale are exempt from the sales or use tax on purchases of feed.
Purpose: To provide equal treatment with those persons who are exempt under the general agriculture statutes. This recognizes that aquaculture and agriculture are similar activities and should be treated the same for tax purposes.
Category/Year Enacted: Agriculture; 1985.
Primary Beneficiaries: Approximately 95 commercial fish farmers.
Conflict With Other Programs: None evident.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 434 | 435 | 436 | 437 |
| Local taxes | 100 | 100 | 101 | 101 |
If the exemption were repealed, would the estimated revenue be realized?
Only if the broader definition of agricultural product in RCW 82.04.213 were similarly repealed.
82.08.0295 PROCESSING EQUIPMENT, SALE/LEASEBACKS
82.12.0295
Description: Property and equipment used in the business of processing fresh fruit, vegetables or fish is exempt from sales tax if it is leased by the original owner under the terms of a sale/leaseback transaction.
Purpose: The exemption eliminates tax liability for the previous owner, who had originally paid sales tax on such property and equipment, but who incurred sales tax liability on lease payments associated with the same property under a sale/leaseback. The exemption is probably now superfluous because of the enactment of the general exemption for manufacturing machinery and equipment in 1995.
Category/Year Enacted: Agriculture; 1986.
Primary Beneficiaries: No known firms.
Conflict With Other Programs: None evident.
Tax savings ($000): No current impact; it is understood that only one firm benefitted from this exemption and it ceased operation during FY 1991. Further, the exemption appears to be redundant with the 1995 manufacturing machinery exemption in RCW 82.08.02565.
82.08.0296 LIVESTOCK FEED
82.12.0296
Description: Feed consumed by livestock at public livestock markets is exempt from sales/use tax.
Purpose: Exempts public livestock markets from tax liability on feed provided to animals owned by others that are awaiting sale.
Category/Year Enacted: Agriculture; 1986.
Primary Beneficiaries: Operators of public livestock markets.
Conflict With Other Programs: None evident.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 85 | 85 | 85 | 85 |
| Local taxes | 21 | 21 | 21 | 21 |
If the exemption were repealed, would the estimated revenue be realized? Yes.
82.08.0311 FRUIT/VEGETABLE PACKING MATERIALS
82.12.0311
Description: Sales/use tax exemption is provided for materials and supplies used in the washing, sorting and packing of fresh horticultural products by any person who is exempt from B&O tax under RCW 82.04.4287.
Purpose: This extends sales tax exemption for packing materials, similar to the B&O exemption that already exists for packing of fresh horticultural products.
Category/Year Enacted: Agriculture; 1988.
Primary Beneficiaries: Fresh fruit and vegetable packing facilities.
Conflict With Other Programs: Yes; packers of other agricultural products and packaging operations in other industries are taxable.
| Tax Savings ($000): | FY 2000 | FY 2001 | FY 2002 | FY 2003 |
| State taxes | 188 | 188 | 188 | 188 |
| Local taxes | 43 | 43 | 43 | 43 |
If the exemption were repealed, would the estimated revenue be realized? Yes; but the packer could structure the sale so that the packing materials were sold prior to packing and thereby reduce the tax liability to the fair rental value.