CERTIFICATION OF ENROLLMENT
ENGROSSED HOUSE BILL 1354
Chapter 217, Laws of 2019
66TH LEGISLATURE
2019 REGULAR SESSION
FOOD PRODUCT SCAN-DOWN ALLOWANCES--BUSINESS AND OCCUPATION TAX DEDUCTION
EFFECTIVE DATE: July 28, 2019
Passed by the House March 28, 2019
  Yeas 93  Nays 0
FRANK CHOPP

Speaker of the House of Representatives
Passed by the Senate April 16, 2019
  Yeas 48  Nays 0
CYRUS HABIB

President of the Senate
CERTIFICATE
I, Bernard Dean, Chief Clerk of the House of Representatives of the State of Washington, do hereby certify that the attached is ENGROSSED HOUSE BILL 1354 as passed by House of Representatives and the Senate on the dates hereon set forth.
BERNARD DEAN

Chief Clerk
Chief Clerk
Approved April 30, 2019 2:41 PM
FILED
May 1, 2019
JAY INSLEE

Governor of the State of Washington
Secretary of State
State of Washington

ENGROSSED HOUSE BILL 1354

Passed Legislature - 2019 Regular Session
State of Washington
66th Legislature
2019 Regular Session
ByRepresentatives Walen, Stokesbary, Wylie, Orcutt, Vick, Frame, Eslick, and Ormsby
Read first time 01/21/19.Referred to Committee on Finance.
AN ACT Relating to providing that scan-down allowances on food and beverages intended for human and pet consumption are bona fide discounts for purposes of the business and occupation tax; adding a new section to chapter 82.04 RCW; and creating a new section.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
NEW SECTION.  Sec. 1. A new section is added to chapter 82.04 RCW to read as follows:
(1) In computing tax under RCW 82.04.290(2), a seller may deduct from the measure of tax the amount of scan-down allowances.
(2) For purposes of this section, a provision that the seller must sell at a certain retail price or a specific price reduction does not constitute either:
(a) A service provided by the seller to the manufacturer or wholesaler; or
(b) A business activity directly or indirectly benefiting the manufacturer or wholesaler.
(3) The definitions in this subsection apply throughout this section unless the context clearly requires otherwise.
(a) "Product" means:
(i) Food and food ingredients other than prepared food, as those terms are defined in RCW 82.08.0293, whether or not exempt from sales tax under RCW 82.08.0293; and
(ii) Pet food and specialty pet food as defined in RCW 15.53.901.
(b) "Scan-down allowance" means a payment or credit offered to a seller by a manufacturer or wholesaler of products, where:
(i) The amount of the payment or credit is based on the quantity of the product to be sold at retail by the seller within a specified period of time;
(ii) The seller knew the terms of the offer before making the sales that generated the payment or credit from the manufacturer or wholesaler; and
(iii) The seller is not required to provide any services to the manufacturer or wholesaler or engage in any business activities directly or indirectly benefiting the manufacturer or wholesaler, in order to receive the payment or credit from the manufacturer or wholesaler.
NEW SECTION.  Sec. 2. The provisions of RCW 82.32.805 and 82.32.808 do not apply to this act.
Passed by the House March 28, 2019.
Passed by the Senate April 16, 2019.
Approved by the Governor April 30, 2019.
Filed in Office of Secretary of State May 1, 2019.
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