S-1611

AN ACT Relating to sales and use taxes on electrical energy imposed by the state, cities, and towns; adding a new section to chapter 82.12 RCW; adding a new section to chapter 82.14 RCW; and providing an effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. A new section is added to chapter 82.12 RCW to read as follows:

(1) There is hereby levied and there shall be collected from every person in this state a use tax for the privilege of consuming electricity within this state.

(2) The tax shall be levied and collected in an amount equal to the value of the electricity multiplied by the rate in effect for the public utility tax on a light and power business as defined under RCW 82.16.010. For the purposes of this section, "value of the electricity" means the consideration paid, given, or contracted to be paid or given by the purchaser of the electricity to the seller of the electricity, but does not include any amounts that are paid for the hire or use of a light and power business as defined in RCW 82.16.010 in transporting the electricity subject to tax under this subsection if those amounts are subject to tax under chapter 82.16 RCW.

(3) The tax levied in this section does not apply to the consumption of electricity generated by a person for the person's own use.

(4) The tax levied in this section does not apply to the consumption of electricity purchased from an agency or instrumentality of the federal government, or from a seller who has paid a tax under RCW 82.16.020 with respect to the electricity for which exemption is sought under this subsection.

(5) There shall be a credit against the tax levied in this section in an amount equal to the tax paid by:

(a) The seller of the electricity when that tax is a gross receipts tax similar to that imposed under RCW 82.16.020 by another state with respect to the electricity for which a credit is sought under this subsection; or

(b) The person consuming the electricity upon which a use tax similar to the tax imposed under this section was paid to another state with respect to the electricity for which a credit is sought under this subsection.

(6) The use tax imposed in this section shall be paid by the person consuming the electricity to the department.

(7) A person delivering electricity to a person subject to tax in this section shall make a quarterly report to the department. The report shall contain the kilowatt hours of electricity delivered, name of the person to whom it is delivered, and such other information as the department may require by rule.

(8) Nothing in this section means that electricity is tangible personal property.

NEW SECTION. Sec. 2. A new section is added to chapter 82.14 RCW to read as follows:

(1) The governing body of a city, while not required by legislative mandate to do so, may, by resolution or ordinance for the purposes authorized by this chapter, fix and impose on every person a use tax for the privilege of consuming electricity within the city.

(2) The tax shall be imposed in an amount equal to the value of the electricity multiplied by the rate in effect for the tax on electrical energy businesses under RCW 35.21.870 in the city in which the electricity is consumed. The "value of the electricity" means the consideration paid, given, or contracted to be paid or given by the purchaser of the electricity to the seller of the electricity, but does not include any amounts that are paid for the hire or use of an electricity business in transporting the electricity subject to tax under this subsection if those amounts are subject to tax under RCW 35.21.870.

(3) The tax levied in this section does not apply to the consumption of electricity generated by a person for that person's own use.

(4) The tax levied in this section does not apply to the consumption of electricity purchased from an agency or instrumentality of the federal government, or from a seller who has paid a tax under RCW 35.21.870 with respect to the electricity for which exemption is sought under this subsection.

(5) There shall be a credit against the tax levied in this section in an amount equal to the tax paid by:

(a) The seller of the electricity when that tax is a gross receipts tax similar to that imposed under RCW 35.21.870 by another state with respect to the electricity for which a credit is sought under this subsection; or

(6) The use tax imposed in this section shall be paid by the person consuming the electricity. The administration and collection of the tax imposed under this section shall be under RCW 82.14.050.

(7) Nothing in this section means that electricity is tangible personal property.

NEW SECTION. Sec. 3. This act takes effect August 1, 1997.