The Washington State Department of Revenue has recently taken action on the following Rules and Interpretive Statements:

The Washington State Department of Revenue has recently taken action on the following Rules and Interpretive Statements:

January 9, 2023

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INTERIM GUIDANCE STATEMENT (IGS) ISSUANCE

Application of the printing and publishing B&O tax classification to digital subscriptions of magazines and periodicals

Why this IGS was Issued

This interim guidance explains when the preferential rate under RCW 82.04.280(1) applies to gross income from publishing digital versions of periodicals or magazines.

View more information on this IGS and others

See the Department’s website at:  https://dor.wa.gov/forms-publications/publications-subject/tax-topics/interim-guidance-statements

RULE ADOPTION (CR-103P) - Excise Tax

WAC 458-20-300 - Capital gains excise tax – Overview and administration

Why this Rule is being Adopted

This new rule clarifies administrative aspects of the excise tax on capital gains, Chapter 82.87 RCW, such as proper filing and payment procedures and potential penalties for not following filing and payment requirements.

Note: Effective January 1, 2022, Chapter 82.87 RCW imposes an excise tax on sales or exchanges of long-term capital assets. In March of 2022, the Douglas County Superior Court ruled that the tax is unconstitutional and invalid. The validity of the tax is currently under review by the Washington Supreme Court, which has stayed the superior court decision. As a result, Chapter 82.87 RCW is in effect and this rule is effective January 28, 2023, unless determined otherwise by the Washington Supreme Court.

Effective Date of Adoption

WAC 458-20-300 will become effective January 28, 2023. 

EXCISE TAX ADVISORIES (ETA) ISSUANCE

ETA 3191 Rewards Programs

Why this ETA was Issued

This ETA addresses rewards programs, specifically, the application of “sales price” to selected types of rewards program awards, the seller’s tax liability when a customer redeems awards for the full price of a good or service, and the tax treatment of rewards programs that commingle both awards representing taxable consideration and awards representing bona fide discounts.

The ETA has been updated to specifically incorporate two interim guidance statements on rewards programs: the interim guidance statement on commingling rewards program awards and the interim guidance statement on deferred sales or use tax.

View more information on this ETA and other ETAs

See the Department’s website at:  http://dor.wa.gov/content/FindALawOrRule/ETA/default.aspx

EXCISE TAX ADVISORIES (ETA) ISSUANCE

ETA 3236 AT&T Services, Inc. v. Department of Revenue

Why this ETA was Issued

The purpose of this ETA is to explain the effect of the Thurston County Superior Court’s order in AT&T Services, Inc. v. Department of Revenue (AT&T Services), which invalidated portions of WAC 458-20-19402 (Rule 19402) for tax periods before June 12, 2014. The court entered its order on May 24, 2021.

View more information on this ETA and other ETAs

See the Department’s website at:  http://dor.wa.gov/content/FindALawOrRule/ETA/default.aspx

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