Recycling and salvage collection

Recyclable or salvaged materials are economically viable for further use and are not taken to a landfill or other disposal facility as solid waste.   

Examples of common recycled materials include: 

• Plastic bottles. 
• Paper. 
• Cardboard. 
• Aluminum cans. 

Examples of common salvaged materials include: 

• Furniture. 
• Wood. 
• Bricks. 
• Metals. 
• Vintage textiles. 

Businesses that recycle or salvage materials are not subject to the solid waste collection tax. However, other taxes apply to income based on the business activity.

Collecting recyclable or salvageable materials

Materials hauled to your own facility 

Income from collecting recyclable or salvageable materials for recycling at your own facility is subject to Service and Other Activities business and occupation (B&O) tax. 

Materials hauled to another facility 

Income from collecting recyclable or salvageable materials and hauling them to a third-party recycling facility is subject to public utility tax (PUT) under either the Motor Transportation or Urban Transportation classification. In this scenario, the hauler can only be responsible for loading, transporting, and unloading the materials. Please see our Motor and urban transportation page for more information.  

Tip fees 

Tip fees for accepting recyclable waste are subject to Service and Other Activities B&O tax.   

Processing and selling recyclable materials 

Processing (Manufacturing)  

Processing recyclable materials into other usable products is a manufacturing activity that is subject to Manufacturing B&O tax. The tax is based on the value of the products manufactured for sale or for the manufacturer’s own use. Use tax is also due on the value of products you manufacture for your own business use.

You may qualify for a Multiple Activities B&O Tax Credit if you are required to report the same income under both the manufacturing activity and the selling activity.

You may qualify for a sales and use tax exemption on purchases of manufacturing machinery and equipment. See the Purchases section of this guide for more information. 

For additional information about manufacturing, please see our Manufacturing Guide.

Selling

Wholesaling B&O tax is due on the gross income from sales of recycled or salvaged materials to buyers that provide a valid reseller permit. 

Retailing B&O tax is due on the gross income from sales of recycled or salvaged materials or new manufactured products to end users. You must also collect retail sales tax, unless the buyer provides a retail sales tax exemption certificate.

A Multiple Activities Tax Credit is available for sales of goods manufactured and sold in Washington so that the sale is only subject to B&O tax once.