WSR 17-08-077
PREPROPOSAL STATEMENT OF INQUIRY
DEPARTMENT OF REVENUE
[Filed April 4, 2017, 8:11 a.m.]
Subject of Possible Rule Making: WAC 458-20-13601 Manufacturers and processors for hire—Sales and use tax exemptions for machinery and equipment.
Statutes Authorizing the Agency to Adopt Rules on this Subject: RCW 82.32.300 and 82.01.060(2).
Reasons Why Rules on this Subject may be Needed and What They Might Accomplish: WAC 458-20-13601 (Rule 13601) explains the retail sales and use tax exemptions provided by RCW 82.08.02565 and 82.12.02565 for sales to or use by manufacturers or processors for hire of machinery and equipment (M&E) used directly in a manufacturing operation or research and development operation. The department proposes to update Rule 13601 to clarify:
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Qualifying M&E used at a permanent manufacturing location is eligible for the M&E exemption even if the items produced are later installed or altered by the manufacturer at a different location.
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Repairs of equipment also qualify for the M&E exemption as long as the equipment repaired is qualifying M&E.
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A research and development operation can qualify for the M&E exemption so long as the manufacturer also has a qualifying manufacturing operation producing tangible personal property for sale.
Other Federal and State Agencies that Regulate this Subject and the Process Coordinating the Rule with These Agencies: None.
Process for Developing New Rule: Parties interested in this rule making may contact the individual listed below. The public may also participate by providing written comments throughout this rule making or giving oral testimony at the public meeting or public hearing.
Interested parties can participate in the decision to adopt the new rule and formulation of the proposed rule before publication. A preliminary draft of possible rule changes is available via the department's online Rules Agenda.
Written comments may be submitted by mail and should be directed to Rex Munger, ITA Division, P.O. Box 47453, Olympia, WA 98504-7453, email RexM@dor.wa.gov.
Written and oral comments will be accepted at the public meeting.
Public Meeting Location: Conference Room 114B, 6400 Linderson Way S.W., Tumwater, WA 98501, on April 19, 2017, at 10:00 a.m. Call-in option can be provided upon request no later than three days before the meeting date.
Assistance for Persons with Disabilities: Contact Julie King, (360) 704-5717, or Renee Cosare, (360) 725-7514, no later than ten days before the meeting date. For hearing impaired please contact us via the Washington relay operator at (800) 833-6384.
April 4, 2017
Kevin Dixon
Rules Coordinator