General manufacturing

Manufacturing

Persons that manufacture products in this state are generally taxable under the Manufacturing business and occupation (B&O) tax classification on the value of the products, including by-products.

Selling

Manufacturers must also report their sales under the Wholesaling B&O or Retailing B&O and Retail Sales tax classifications.

They may take an Interstate and Foreign Sales deduction from each selling classification for goods delivered to customers outside of Washington.

Multiple Activities Tax Credit (MATC)

Businesses that perform more than one taxable activity for the same product will report each activity under the proper classification and then take the MATC so that B&O tax is only paid once.

For more information, please see the MATC section of this guide.

Litter tax

Litter tax applies to manufacturing, wholesaling, and retailing of certain products in Washington. Products subject to litter tax include:

• Food for human or pet consumption.
• Groceries.
• Cigarettes and tobacco products.
• Soft drinks and carbonated waters.
• Beer and other malt beverages.
• Wine.
• Newspapers and magazines.
• Household paper and paper products.
• Glass containers.
• Metal containers.
• Plastic or fiber containers made of synthetic material.
• Cleaning agents.
• Toiletries.
• Nondrug drugstore sundry products.