Vessel deconstruction services are not subject to sales/use tax (RCW 82.08.9996, RCW 82.12.9996).
Qualifying deconstruction services:
To qualify for the exemption, the deconstruction services must be performed at either:
- A qualified vessel deconstruction facility; or
- An area over water which has a National Pollutant Discharge Elimination System (NPDES) permit for vessel deconstruction
The buyer must give the seller a Buyer’s Retail Sales Tax Exemption Certificate. The seller must keep a copy of the completed exemption certificate for five years.
Buyer reporting requirements:
Taxpayers who use this exemption must submit a Buyer’s Sales and Use Tax Preference Addendum when they electronically file their next excise tax return.
Definitions
Vessel deconstruction: permanently dismantling a vessel, including:
- Abatement and removal of hazardous materials
- Removal of mechanical, hydraulic, or electronic components or other vessel machinery and equipment;
- Cutting apart or disposal, or both, of vessel infrastructure.
Vessel deconstruction does not include vessel modification or repair.
Hazardous materials: includes fuel, lead, asbestos, polychlorinated biphenyls, and oils.
Qualified vessel deconstruction facility: structures, including floating structures, which have a National Pollutant Discharge Elimination System (NPDES) permit for vessel deconstruction.
For more information, see Special Notice: Vessel Deconstruction-Sales & Use Tax Exemption.