Out-of-state wineries may sell wine directly to Washington consumers. However, the winery must collect the appropriate state and local sales or use taxes from their customers and send the tax to the Department of Revenue.
Before an out-of-state winery can sell and ship directly to Washington consumers, it must:
- Register with the Department of Revenue.
- Follow all the requirements administered by the Liquor and Cannabis Board (LCB) including, but not limited to:
- Obtaining a wine shipper’s permit from the LCB.
- Paying all applicable LCB taxes and permit fees.
Out-of-state wineries that sell and ship directly to Washington consumers must collect either use tax or retail sales tax from their Washington customers regardless of whether they have nexus in Washington. Either the sales or use tax must be collected, but not both.
Sales and use tax rate
Sales and use tax have the same rate and are calculated on the selling price, including all shipping, handling, and delivery charges. The retail sales and use tax rates are based on the location where the products are delivered to your customers in Washington. The department has sales and use tax tools available to help you calculate the correct rate.
Wineries with nexus
If you have nexus in Washington, you must collect retail sales tax and report business and occupation (B&O) tax under the Retailing classification on your sales delivered to consumers in Washington. You also owe litter tax on sales of wine and other litter taxable products delivered to customers in Washington.
Wineries do not need to have an office or physical location in the state to have nexus and be subject to Washington’s tax laws. To determine if you have established nexus in Washington, see our Out of state businesses reporting thresholds and nexus guide.
Wineries without nexus
If you do not have nexus in Washington, you must collect use tax on sales of wine delivered to customers in Washington. In this case, Retailing B&O tax is not due.