Washington Tax Decisions

A taxpayer that operates a data center in Washington State disputes the disallowance of certain sales and use tax exemptions it claimed under its data center tax exemption certificate. The Department disallowed the exemptions on the basis that the taxpayer did not meet certain employment requirements in the six-year period after it acquired the certificate. We deny the petition.

An event-merchandise vending company (Taxpayer) protests an assessment by the Department of Revenue (Department). The Department’s assessment included adjustments for unpaid retail sales tax and service and other activities B&O tax. The Department also imposed an evasion penalty on Taxpayer for not remitting to the state the retail sales taxes it collected. Taxpayer contends that, as a consignee, it collected the retail sales tax on behalf of consignors, and it was not obligated to remit the retail sales tax to the state. Taxpayer failed to meet its burden to rebut the presumption that as the seller of tangible personal property it was required to collect and remit retail sales tax. As Taxpayer neither reported nor remitted the retail sales taxes it collected, the Department’s imposition of the evasion penalty was appropriate. However, some adjustments with respect to the assessment and in favor of Taxpayer, are warranted. We deny the petition in part and grant in part.

A wholesale distributor of beer and non-alcoholic beverages protests the inclusion of certain proceeds in its measure of income for B&O tax purposes. Taxpayer claims a portion of the measure of its income used by the Department to calculate taxpayer’s B&O tax liability should not have been included because taxpayer engages in providing such services as a joint venture with two related entities. We deny taxpayer’s petition.

A chiropractic professional services corporation seeks abatement of the assessment penalty and interest on grounds that the corporation’s billing and payment processor suffered a cyberattack preventing the corporation from submitting claims or getting paid, and the corporation was advised to wait for contact from the Department regarding a payment plan. Because the corporation failed to prove that circumstances beyond its control caused the late payment and reliance on oral instructions is not a basis upon which the Department can grant a penalty waiver, we deny the petition.

A technology retailer and wholesaler protests the imposition, classification, and apportionment of tax on rebate income. The petition is denied.

A group of grantor’s trusts that were formed by the subsidiary of a bank holding company disputes the Department’s tax assessment because the group asserts it qualifies for the securitization entity exemption from B&O tax. Because the group has not established that it was formed by a bank holding company, we deny the petition.

An individual contests an assessment under the Department’s WFTC program for the 2022 tax year, arguing the Department incorrectly removed two qualifying children from Applicant’s application. We deny the petition.