Sales Tax in Washington: A Complete Guide for Ecommerce Sellers

Washington is an SST member state with a $100,000 economic nexus threshold and among the highest combined sales tax rates in the country (up to 10.4% in some cities). It was an early adopter of economic nexus post-Wayfair. Washington also levies a Business & Occupation (B&O) tax on gross receipts: a separate obligation from sales tax that many remote sellers overlook when they first register.

Quick reference

Economic nexus

Washington’s threshold is $100,000 in retail sales into Washington, measured on a calendar year basis. Washington enacted economic nexus on October 1, 2018, one of the first states to do so after Wayfair.

There is no transaction count threshold in Washington, only the dollar amount matters.

Physical nexus

Physical presence in Washington creates nexus without any threshold:

• Warehouse, office, or storage facility
• Amazon FBA inventory in Washington fulfillment centers
• Employees or independent contractors in Washington
• Sales representatives in Washington

Registration

Washington is an SST member state. Sellers can register through a Certified Service Provider (CSP) — a single SST application covers Washington and all other SST member states simultaneously. Registration through a CSP is free.

Sellers can also register directly at the Washington Department of Revenue (dor.wa.gov). Washington’s My DOR portal handles both sales tax and B&O tax registration.

Important: When registering in Washington, consider whether B&O tax registration is also required (see State-Specific Notes below).

Tax rates

State rate: 6.5%

Local rates: Washington allows cities and counties to levy local sales taxes on top of the state rate. Local additions range from 0.5% to 4%. Combined rates in major Washington cities:

• Seattle: 10.35%
• Tacoma: 10.4%
• Bellevue: 10.3%
• Spokane: 8.9%
• Olympia: 9.0%

Washington has one of the highest combined rate spreads in the SST program. Rooftop-level calculation is important, rates can vary significantly across zip codes in the Seattle metro area.

What’s taxable

Generally taxable: Electronics, clothing, furniture, sporting goods, most tangible personal property.

Generally exempt:

• Prescription medications
• Grocery food items (food and food ingredients for human consumption)
• Agricultural products and equipment
• Medical devices with a prescription

Notable Washington rules:

• Digital products: Washington taxes specified digital products, digital books, digital music, digital video, digital codes. Remote sellers of digital goods into Washington have sales tax obligations
• SaaS: Washington taxes SaaS and digital automated services
• Candy: Taxable in Washington (not treated as exempt food)
• Dietary supplements: Taxable

Shipping taxability

Washington taxes delivery charges when the goods being delivered are taxable. If the goods are exempt, the delivery charge is also exempt.

Marketplace facilitator rules

Washington enacted marketplace facilitator legislation effective January 1, 2018, before most other states. Qualifying marketplace facilitators collect and remit Washington sales tax on marketplace-facilitated sales.

Washington was a leader in marketplace facilitator legislation, and the law is broadly applied. Remote sellers whose only Washington sales are through marketplace facilitators and who have no physical nexus may not need to separately register. Sellers with physical nexus must register regardless.

State-specific notes

Business & Occupation (B&O) tax: Washington levies a B&O gross receipts tax on the privilege of conducting business in Washington. For retail sales, the standard B&O rate is 0.471% (rates differ by business classification, wholesale, services, manufacturing each have different rates). The B&O tax is an obligation of the seller, not collectible from customers like sales tax.

Remote sellers with Washington economic nexus or physical nexus are generally subject to B&O tax on their Washington gross receipts. The B&O tax is filed with the Washington Department of Revenue through the same My DOR portal as sales tax. Registration for sales tax and B&O tax can be done simultaneously.

Many remote sellers who discover Washington sales tax obligations are surprised to learn that B&O tax applies separately. Work with a SALT advisor to confirm your B&O classification and rate.

High local rates: Washington’s local sales tax rates are among the highest in any SST state. Sellers need rooftop-level calculation, estimated or zip-code rates will frequently be inaccurate in the Seattle metro area.

Early Wayfair adopter: Washington enacted economic nexus in October 2018, earlier than most states. If you’ve had meaningful Washington sales since late 2018, your potential Washington nexus period is longer than in states that enacted later.