AN ACT Relating to
excise tax changes needed as a result of the United States supreme court in Jefferson
Lines v. Oklahoma; amending RCW 82.04.050, 82.04.060, 82.04.190, 82.12.020,
and 82.12.035; reenacting and amending RCW 82.04.260; providing an effective
date; and declaring an emergency.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF
WASHINGTON:
Sec. 1. RCW 82.04.050 and 1995
1st sp.s. c 12 s 2 are each amended to read as follows:
(1) "Sale at
retail" or "retail sale" means every sale of tangible personal
property (including articles produced, fabricated, or imprinted) to all persons
irrespective of the nature of their business and including, among others,
without limiting the scope hereof, persons who install, repair, clean, alter,
improve, construct, or decorate real or personal property of or for consumers
other than a sale to a person who presents a resale certificate under RCW
82.04.470 and who:
(a) Purchases for the
purpose of resale as tangible personal property in the regular course of
business without intervening use by such person; or
(b) Installs, repairs,
cleans, alters, imprints, improves, constructs, or decorates real or personal
property of or for consumers, if such tangible personal property becomes an ingredient
or component of such real or personal property without intervening use by such
person; or
(c) Purchases for the
purpose of consuming the property purchased in producing for sale a new article
of tangible personal property or substance, of which such property becomes an
ingredient or component or is a chemical used in processing, when the primary
purpose of such chemical is to create a chemical reaction directly through
contact with an ingredient of a new article being produced for sale; or
(d) Purchases for the
purpose of consuming the property purchased in producing ferrosilicon which is
subsequently used in producing magnesium for sale, if the primary purpose of
such property is to create a chemical reaction directly through contact with an
ingredient of ferrosilicon; or
(e) Purchases for the
purpose of providing the property to consumers as part of competitive telephone
service, as defined in RCW 82.04.065. The term shall include every sale of
tangible personal property which is used or consumed or to be used or consumed
in the performance of any activity classified as a "sale at retail"
or "retail sale" even though such property is resold or utilized as
provided in (a), (b), (c), (d), or (e) of this subsection following such use.
The term also means every sale of tangible personal property to persons engaged
in any business which is taxable under RCW 82.04.280 (2) and (7) and 82.04.290.
(2) The term "sale
at retail" or "retail sale" shall include the sale of or charge
made for tangible personal property consumed and/or for labor and services
rendered in respect to the following:
(a) The installing,
repairing, cleaning, altering, imprinting, or improving of tangible personal
property of or for consumers, including charges made for the mere use of
facilities in respect thereto, but excluding sales of laundry service to
members by nonprofit associations composed exclusively of nonprofit hospitals,
and excluding services rendered in respect to live animals, birds and insects;
(b) The constructing,
repairing, decorating, or improving of new or existing buildings or other
structures under, upon, or above real property of or for consumers, including
the installing or attaching of any article of tangible personal property
therein or thereto, whether or not such personal property becomes a part of the
realty by virtue of installation, and shall also include the sale of services
or charges made for the clearing of land and the moving of earth excepting the
mere leveling of land used in commercial farming or agriculture;
(c) The charge for
labor and services rendered in respect to constructing, repairing, or improving
any structure upon, above, or under any real property owned by an owner who
conveys the property by title, possession, or any other means to the person
performing such construction, repair, or improvement for the purpose of
performing such construction, repair, or improvement and the property is then
reconveyed by title, possession, or any other means to the original owner;
(d) The sale of or
charge made for labor and services rendered in respect to the cleaning,
fumigating, razing or moving of existing buildings or structures, but shall not
include the charge made for janitorial services; and for purposes of this
section the term "janitorial services" shall mean those cleaning and
caretaking services ordinarily performed by commercial janitor service
businesses including, but not limited to, wall and window washing, floor
cleaning and waxing, and the cleaning in place of rugs, drapes and upholstery.
The term "janitorial services" does not include painting, papering,
repairing, furnace or septic tank cleaning, snow removal or sandblasting;
(e) The sale of or
charge made for labor and services rendered in respect to automobile towing and
similar automotive transportation services, but not in respect to those
required to report and pay taxes under chapter 82.16 RCW;
(f) The sale of and
charge made for the furnishing of lodging and all other services by a hotel,
rooming house, tourist court, motel, trailer camp, and the granting of any
similar license to use real property, as distinguished from the renting or
leasing of real property, and it shall be presumed that the occupancy of real
property for a continuous period of one month or more constitutes a rental or
lease of real property and not a mere license to use or enjoy the same;
(g) The sale of or
charge made for tangible personal property, labor and services to persons
taxable under (a), (b), (c), (d), (e), and (f) of this subsection when such
sales or charges are for property, labor and services which are used or
consumed in whole or in part by such persons in the performance of any activity
defined as a "sale at retail" or "retail sale" even though
such property, labor and services may be resold after such use or consumption.
Nothing contained in this subsection shall be construed to modify subsection
(1) of this section and nothing contained in subsection (1) of this section
shall be construed to modify this subsection.
(3) The term "sale
at retail" or "retail sale" shall include the sale of or charge
made for personal, business, or professional services including amounts
designated as interest, rents, fees, admission, and other service emoluments
however designated, received by persons engaging in the following business
activities:
(a) Amusement and
recreation services including but not limited to golf, pool, billiards,
skating, bowling, ski lifts and tows, day trips for sightseeing purposes,
and others, when provided to consumers;
(b) Abstract, title
insurance, and escrow services;
(c) Credit bureau
services;
(d) Automobile parking
and storage garage services;
(e) Landscape maintenance
and horticultural services but excluding (i) horticultural services provided to
farmers and (ii) pruning, trimming, repairing, removing, and clearing of trees
and brush near electric transmission or distribution lines or equipment, if
performed by or at the direction of an electric utility;
(f) Service charges
associated with tickets to professional sporting events; and
(g) ((Guided tours
and guided charters; and
(h))) The following personal services: Physical
fitness services, tanning salon services, tattoo parlor services, steam bath
services, turkish bath services, escort services, and dating services.
(4) The term shall also
include the renting or leasing of tangible personal property to consumers and
the rental of equipment with an operator.
(5) The term shall also
include the providing of telephone service, as defined in RCW 82.04.065, to
consumers.
(6) The term shall not
include the sale of or charge made for labor and services rendered in respect
to the building, repairing, or improving of any street, place, road, highway,
easement, right of way, mass public transportation terminal or parking
facility, bridge, tunnel, or trestle which is owned by a municipal corporation
or political subdivision of the state or by the United States and which is used
or to be used primarily for foot or vehicular traffic including mass
transportation vehicles of any kind.
(7) The term shall also
not include sales of feed, seed, seedlings, fertilizer, agents for enhanced
pollination including insects such as bees, and spray materials to persons who
participate in the federal conservation reserve program or its successor
administered by the United States department of agriculture, or to farmers for
the purpose of producing for sale any agricultural product, nor shall it
include sales of chemical sprays or washes to persons for the purpose of
post-harvest treatment of fruit for the prevention of scald, fungus, mold, or
decay.
(8) The term shall not
include the sale of or charge made for labor and services rendered in respect
to the constructing, repairing, decorating, or improving of new or existing
buildings or other structures under, upon, or above real property of or for the
United States, any instrumentality thereof, or a county or city housing
authority created pursuant to chapter 35.82 RCW, including the installing, or
attaching of any article of tangible personal property therein or thereto,
whether or not such personal property becomes a part of the realty by virtue of
installation. Nor shall the term include the sale of services or charges made
for the clearing of land and the moving of earth of or for the United States,
any instrumentality thereof, or a county or city housing authority.
Sec. 2. RCW 82.04.260 and 1995
2nd sp.s. c 12 s 1 and 1995 2nd sp.s. c 6 s 1 are each reenacted and amended to
read as follows:
(1) Upon every person
engaging within this state in the business of buying wheat, oats, dry peas, dry
beans, lentils, triticale, canola, corn, rye and barley, but not including any
manufactured or processed products thereof, and selling the same at wholesale;
the tax imposed shall be equal to the gross proceeds derived from such sales
multiplied by the rate of 0.011 percent.
(2) Upon every person
engaging within this state in the business of manufacturing wheat into flour,
barley into pearl barley, soybeans into soybean oil, canola into canola oil,
canola meal, or canola byproducts, or sunflower seeds into sunflower oil; as to
such persons the amount of tax with respect to such business shall be equal to
the value of the flour, pearl barley, oil, canola meal, or canola byproduct
manufactured, multiplied by the rate of 0.138 percent.
(3) Upon every person
engaging within this state in the business of splitting or processing dried
peas; as to such persons the amount of tax with respect to such business shall
be equal to the value of the peas split or processed, multiplied by the rate of
0.275 percent.
(4) Upon every person
engaging within this state in the business of manufacturing seafood products
which remain in a raw, raw frozen, or raw salted state at the completion of the
manufacturing by that person; as to such persons the amount of tax with respect
to such business shall be equal to the value of the products manufactured,
multiplied by the rate of 0.138 percent.
(5) Upon every person
engaging within this state in the business of manufacturing by canning,
preserving, freezing or dehydrating fresh fruits and vegetables; as to such
persons the amount of tax with respect to such business shall be equal to the
value of the products canned, preserved, frozen or dehydrated multiplied by the
rate of 0.33 percent.
(6) Upon every
nonprofit corporation and nonprofit association engaging within this state in
research and development, as to such corporations and associations, the amount
of tax with respect to such activities shall be equal to the gross income
derived from such activities multiplied by the rate of 0.484 percent.
(7) Upon every person
engaging within this state in the business of slaughtering, breaking and/or
processing perishable meat products and/or selling the same at wholesale only
and not at retail; as to such persons the tax imposed shall be equal to the gross
proceeds derived from such sales multiplied by the rate of 0.138 percent.
(8) Upon every person
engaging within this state in the business of making sales, at retail or
wholesale, of nuclear fuel assemblies manufactured by that person, as to such
persons the amount of tax with respect to such business shall be equal to the
gross proceeds of sales of the assemblies multiplied by the rate of 0.275
percent.
(9) Upon every person
engaging within this state in the business of manufacturing nuclear fuel assemblies,
as to such persons the amount of tax with respect to such business shall be
equal to the value of the products manufactured multiplied by the rate of 0.275
percent.
(10) Upon every person
engaging within this state in the business of acting as a travel agent or
tour operator; as to such persons the amount of the tax with respect to
such activities shall be equal to the gross income derived from such activities
multiplied by the rate of 0.275 percent.
(11) Upon every person
engaging within this state in business as an international steamship agent,
international customs house broker, international freight forwarder, vessel
and/or cargo charter broker in foreign commerce, and/or international air cargo
agent; as to such persons the amount of the tax with respect to only
international activities shall be equal to the gross income derived from such
activities multiplied by the rate of 0.363 percent.
(12) Upon every person
engaging within this state in the business of stevedoring and associated
activities pertinent to the movement of goods and commodities in waterborne
interstate or foreign commerce; as to such persons the amount of tax with
respect to such business shall be equal to the gross proceeds derived from such
activities multiplied by the rate of 0.363 percent. Persons subject to
taxation under this subsection shall be exempt from payment of taxes imposed by
chapter 82.16 RCW for that portion of their business subject to taxation under
this subsection. Stevedoring and associated activities pertinent to the
conduct of goods and commodities in waterborne interstate or foreign commerce
are defined as all activities of a labor, service or transportation nature
whereby cargo may be loaded or unloaded to or from vessels or barges, passing
over, onto or under a wharf, pier, or similar structure; cargo may be moved to
a warehouse or similar holding or storage yard or area to await further
movement in import or export or may move to a consolidation freight station and
be stuffed, unstuffed, containerized, separated or otherwise segregated or
aggregated for delivery or loaded on any mode of transportation for delivery to
its consignee. Specific activities included in this definition are: Wharfage,
handling, loading, unloading, moving of cargo to a convenient place of delivery
to the consignee or a convenient place for further movement to export mode;
documentation services in connection with the receipt, delivery, checking,
care, custody and control of cargo required in the transfer of cargo; imported
automobile handling prior to delivery to consignee; terminal stevedoring and
incidental vessel services, including but not limited to plugging and
unplugging refrigerator service to containers, trailers, and other refrigerated
cargo receptacles, and securing ship hatch covers.
(13) Upon every person
engaging within this state in the business of disposing of low-level waste, as
defined in RCW 43.145.010; as to such persons the amount of the tax with
respect to such business shall be equal to the gross income of the business,
excluding any fees imposed under chapter 43.200 RCW, multiplied by the rate of
3.3 percent.
If the gross income of
the taxpayer is attributable to activities both within and without this state,
the gross income attributable to this state shall be determined in accordance
with the methods of apportionment required under RCW 82.04.460.
(14) Upon every person
engaging within this state as an insurance agent, insurance broker, or
insurance solicitor licensed under chapter 48.17 RCW; as to such persons, the
amount of the tax with respect to such licensed activities shall be equal to
the gross income of such business multiplied by the rate of 0.55 percent.
(15) Upon every person
engaging within this state in business as a hospital, as defined in chapter
70.41 RCW, that is operated as a nonprofit corporation or by the state or any
of its political subdivisions, as to such persons, the amount of tax with
respect to such activities shall be equal to the gross income of the business
multiplied by the rate of 0.75 percent through June 30, 1995, and 1.5 percent
thereafter. The moneys collected under this subsection shall be deposited in
the health services account created under RCW 43.72.900.
Sec. 3. RCW 82.04.060 and 1983 2nd
ex.s. c 3 s 26 are each amended to read as follows:
"Sale at
wholesale" or "wholesale sale" means any sale of tangible
personal property, any sale of amusement or recreation services as defined
in RCW 82.04.050(3)(a), or any sale of telephone service as defined in RCW
82.04.065, which is not a sale at retail and means any charge made for labor
and services rendered for persons who are not consumers, in respect to real or
personal property, if such charge is expressly defined as a retail sale by RCW
82.04.050 when rendered to or for consumers: PROVIDED, That the term
"real or personal property" as used in this section shall not include
any natural products named in RCW 82.04.100.
Sec. 4. RCW 82.04.190 and 1995
1st sp.s. c 3 s 4 are each amended to read as follows:
"Consumer"
means the following:
(1) Any person who
purchases, acquires, owns, holds, or uses any article of tangible personal
property irrespective of the nature of the person's business and including,
among others, without limiting the scope hereof, persons who install, repair,
clean, alter, improve, construct, or decorate real or personal property of or
for consumers other than for the purpose (a) of resale as tangible personal
property in the regular course of business or (b) of incorporating such
property as an ingredient or component of real or personal property when
installing, repairing, cleaning, altering, imprinting, improving, constructing,
or decorating such real or personal property of or for consumers or (c) of
consuming such property in producing for sale a new article of tangible
personal property or a new substance, of which such property becomes an
ingredient or component or as a chemical used in processing, when the primary
purpose of such chemical is to create a chemical reaction directly through
contact with an ingredient of a new article being produced for sale or (d)
purchases for the purpose of consuming the property purchased in producing
ferrosilicon which is subsequently used in producing magnesium for sale, if the
primary purpose of such property is to create a chemical reaction directly
through contact with an ingredient of ferrosilicon;
(2)(a) Any
person engaged in any business activity taxable under RCW 82.04.290 ((and));
(b) any person who purchases, acquires, or uses any telephone service as
defined in RCW 82.04.065, other than for resale in the regular course of
business; and (c) any person who purchases, acquires, or uses any amusement
and recreation service defined in RCW 82.04.050(3)(a), other than for resale in
the regular course of business;
(3) Any person engaged
in the business of contracting for the building, repairing or improving of any
street, place, road, highway, easement, right of way, mass public
transportation terminal or parking facility, bridge, tunnel, or trestle which
is owned by a municipal corporation or political subdivision of the state of
Washington or by the United States and which is used or to be used primarily
for foot or vehicular traffic including mass transportation vehicles of any
kind as defined in RCW 82.04.280, in respect to tangible personal property when
such person incorporates such property as an ingredient or component of such
publicly owned street, place, road, highway, easement, right of way, mass
public transportation terminal or parking facility, bridge, tunnel, or trestle
by installing, placing or spreading the property in or upon the right of way of
such street, place, road, highway, easement, bridge, tunnel, or trestle or in
or upon the site of such mass public transportation terminal or parking
facility;
(4) Any person who is
an owner, lessee or has the right of possession to or an easement in real
property which is being constructed, repaired, decorated, improved, or
otherwise altered by a person engaged in business, excluding only (a) municipal
corporations or political subdivisions of the state in respect to labor and
services rendered to their real property which is used or held for public road
purposes, and (b) the United States, instrumentalities thereof, and county and
city housing authorities created pursuant to chapter 35.82 RCW in respect to
labor and services rendered to their real property. Nothing contained in this
or any other subsection of this definition shall be construed to modify any
other definition of "consumer";
(5) Any person who is
an owner, lessee, or has the right of possession to personal property which is
being constructed, repaired, improved, cleaned, imprinted, or otherwise altered
by a person engaged in business;
(6) Any person engaged
in the business of constructing, repairing, decorating, or improving new or
existing buildings or other structures under, upon, or above real property of
or for the United States, any instrumentality thereof, or a county or city housing
authority created pursuant to chapter 35.82 RCW, including the installing or
attaching of any article of tangible personal property therein or thereto,
whether or not such personal property becomes a part of the realty by virtue of
installation; also, any person engaged in the business of clearing land and
moving earth of or for the United States, any instrumentality thereof, or a
county or city housing authority created pursuant to chapter 35.82 RCW. Any
such person shall be a consumer within the meaning of this subsection in
respect to tangible personal property incorporated into, installed in, or
attached to such building or other structure by such person; and
(7) Any person who is a
lessor of machinery and equipment, the rental of which is exempt from the tax
imposed by RCW 82.08.020 under RCW 82.08.02565, with respect to the sale of or
charge made for tangible personal property consumed and for labor and services
rendered in respect to repairing the machinery and equipment.
Nothing contained in
this or any other subsection of this definition shall be construed to modify
any other definition of "consumer."
Sec. 5. RCW 82.12.020 and 1994 c
93 s 2 are each amended to read as follows:
(1) There is hereby
levied and there shall be collected from every person in this state a tax or
excise for the privilege of using within this state as a consumer any article
of tangible personal property purchased at retail, or acquired by lease, gift, repossession,
or bailment, or extracted or produced or manufactured by the person so using
the same, or otherwise furnished to a person engaged in any business taxable
under RCW 82.04.280 (2) or (7), or any amusement or recreation service
defined as a retail sale in RCW 82.04.050(3)(a).
(2) This tax shall
apply to the use of every service defined as a retail sale in RCW
82.04.050(3)(a) and the use of every article of tangible personal property,
including property acquired at a casual or isolated sale, and including
byproducts used by the manufacturer thereof, except as hereinafter provided,
irrespective of whether the article or similar articles are manufactured or are
available for purchase within this state.
(3) Except as provided
in RCW 82.12.0252, payment by one purchaser or user of tangible personal
property or service of the tax imposed by chapter 82.08 or 82.12 RCW
shall not have the effect of exempting any other purchaser or user of the same
property or service from the taxes imposed by such chapters.
(4) The tax shall be
levied and collected in an amount equal to the value of the article used by the
taxpayer multiplied by the rate in effect for the retail sales tax under RCW
82.08.020.
Sec. 6. RCW 82.12.035 and 1987 c
27 s 2 are each amended to read as follows:
A credit shall be
allowed against the taxes imposed by this chapter upon the use of tangible
personal property, or services taxable under RCW 82.04.050(3)(a), in the
state of Washington in the amount that the present user thereof or his or her
bailor or donor has paid a retail sales or use tax with respect to such
property to any other state of the United States, any political subdivision
thereof, the District of Columbia, and any foreign country or political
subdivision thereof, prior to the use of such property in Washington.
NEW SECTION. Sec.
7. If any provision of this
act or its application to any person or circumstance is held invalid, the
remainder of the act or the application of the provision to other persons or
circumstances is not affected.
NEW
SECTION. Sec. 8. This act is necessary for
the immediate preservation of the public peace, health, or safety, or support
of the state government and its existing public institutions, and shall take
effect April 1, 1996.
