Many wineries have tasting rooms. This is a place where potential customers can sample wine before deciding which wine(s) to purchase. Depending on whether or not you charge tasting fees, you will either report retail sales tax and Retailing B&O tax or use tax.
When wine is pulled from inventory and used for wine pours/tasting and a tasting fee is charged, the tasters are considered the consumers. Tasting fees are a retail sale. You will report these fees under the Retailing B&O and Retail Sales tax classifications.
Sales tax included in tasting fee
Generally, sales tax is required to be separately stated. However, wineries that charge a tasting fee may advertise the posted tasting fee as including sales tax. The words "tax included" should be stated immediately following the advertised price in print size at least half as large as the advertised price print size, unless the advertised price is one in a listed series.
Example backing out the sales tax amount: The total amount received from wine tasting fees at a winery is $300. The applicable sales tax rate for the winery location is 7.9%. The gross taxable amount subject to sales tax and retailing B&O tax is $278.04 ($300/1.079 = $278.04).
No tasting fee
When wine is pulled from inventory and used for wine pours/tastings and there is no tasting fee charged, the winery is considered the consumer. You owe use tax based on the retail value of that particular bottle of wine. The retail value is based on the retail selling price of a like bottle of wine.
WAC 458-20-107 Requirement to separately state sales tax-Advertised prices including sales tax.
WAC 458-20-178 Use tax and the use of tangible personal property.