BILL REQ. #:  H-1504.1 

Read first time 02/09/09.   Referred to Committee on Finance.

     AN ACT Relating to providing tax relief to motor vehicle dealers; amending RCW 82.08.020; adding a new section to chapter 82.04 RCW; and providing an expiration date.

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

Sec. 1   RCW 82.08.020 and 2006 c 1 s 3 are each amended to read as follows:
     (1) Except as provided in subsection (8) of this section, there is levied and there shall be collected a tax on each retail sale in this state equal to six and five-tenths percent of the selling price.
     (2) There is levied and there shall be collected an additional tax on each retail car rental, regardless of whether the vehicle is licensed in this state, equal to five and nine-tenths percent of the selling price. The revenue collected under this subsection shall be deposited in the multimodal transportation account created in RCW 47.66.070.
     (3) ((Beginning July 1, 2003)) Except as provided in subsection (8) of this section, there is levied and collected an additional tax of three-tenths of one percent of the selling price on each retail sale of a motor vehicle in this state, other than retail car rentals taxed under subsection (2) of this section. The revenue collected under this subsection shall be deposited in the multimodal transportation account created in RCW 47.66.070.
     (4) For purposes of subsections (3) and (8) of this section, "motor vehicle" has the meaning provided in RCW 46.04.320, but does not include farm tractors or farm vehicles as defined in RCW 46.04.180 and 46.04.181, off-road and nonhighway vehicles as defined in RCW 46.09.020, and snowmobiles as defined in RCW 46.10.010.
     (5) Beginning on December 8, 2005, 0.16 percent of the taxes collected under subsection (1) of this section shall be dedicated to funding comprehensive performance audits required under RCW 43.09.470. The revenue identified in this subsection shall be deposited in the performance audits of government account created in RCW 43.09.475.
     (6) The taxes imposed under this chapter shall apply to successive retail sales of the same property.
     (7) The rates provided in this section apply to taxes imposed under chapter 82.12 RCW as provided in RCW 82.12.020.
     (8) Until January 1, 2010, the total combined tax rate on the retail sale of a new motor vehicle in this state is equal to three and one-quarter percent of the selling price.

NEW SECTION.  Sec. 2   A new section is added to chapter 82.04 RCW to read as follows:
     (1) In computing the tax imposed under this chapter, a credit is allowed against the amount of tax otherwise due under this chapter for fifty percent of the amount paid by a motor vehicle dealer licensed under chapter 46.70 RCW or a dealer licensed by any other state. The credit may not exceed the tax otherwise due under this chapter for the reporting period.
     (2) The credit earned in one reporting period may be carried over to be credited against taxes incurred in a subsequent reporting period. However, credit may not be carried over for more than twelve months from the ending date of the reporting period in which the credit was earned.
     (3) No credit may be earned under this section on or after January 1, 2010.
     (4) This section expires January 1, 2011.