Business Taxes in Washington State

Washington State does not have a corporate or personal income tax. However, Washington businesses generally are subject to the following:

  • Business and occupation (B&O) tax: This is a gross receipts tax that is calculated on the value of products, gross proceeds of sale, or gross income of the business. The B&O tax rates vary depending on the type of business activity.
  • Retail sales/use tax: This is a tax on the sale of tangible personal property and certain services. The sales tax rate is 6.5% in Washington State. Businesses that sell taxable goods or services must collect sales tax from their customers and remit it to the state.
  • Personal property tax: This is a tax on the value of certain personal property that is owned businesses. The personal property tax rates vary depending on the type of property and the location of the business.

In addition to these taxes, businesses in Washington State may also be subject to other taxes, such as the following:

  • Franchise tax: This is a tax that is imposed on certain businesses that are granted a franchise the state.
  • Utility tax: This is a tax on the gross receipts of businesses that provide certain utilities, such as electricity, gas, and water.
  • Motor vehicle excise tax: This is a tax on the value of motor vehicles that are owned businesses.

Businesses in Washington State can find more information about business taxes on the website of the Washington Department of Revenue.

Here are some additional things to keep in mind about business taxes in Washington State:

  • Businesses are required to register with the Washington Department of Revenue and obtain a business license before they can start doing business.
  • Businesses are required to file tax returns and pay taxes on a regular basis. The frequency of filing and payment depends on the type of tax and the amount of business activity.
  • Businesses may be eligible for tax deductions and credits. The specific deductions and credits that are available vary depending on the type of business and the type of tax.

It is important for businesses to understand the business taxes that they are subject to and to comply with all applicable tax laws. Failure to do so could result in penalties and interest charges.

If you have any questions about business taxes in Washington State, you should consult with a tax professional.