Starting Monday, Alaskans shopping in Washington state won’t enjoy the easy sales tax break they have gotten for 54 years. Instead, under a new law passed by Washington legislators, they’ll have to save their receipts and apply later for the sales tax exemption by requesting a refund from the Department of Revenue.
Washington state sales tax is 6.5 percent.
The change in the tax law likely means that most out-of-state shoppers will not take the time to make that application, and that Washington will get tens of millions more in sales tax dollars. The new system also applies to those from other states that don’t have sales tax, including Oregon, Delaware, Montana and New Hampshire, and some Canadian provinces.
Under the prior system, Alaskans filled out a form at the point of sale, and showed their Alaska ID to obtain the sales tax deduction at the cash register.
According to the Washington Department of Revenue, the refund applies to purchases of tangible personal property, digital products, or digital codes for items to be used only outside Washington State by purchasers who can prove residency in a qualifying jurisdiction.
Refunds have never been available for services such as lodging at hotels, repair services, laundry or dry cleaning, meals, personal services like tattooing or dating services, or title and escrow services.
Also exempt from tax refunds are marijuana products.
To get a refund, you’ll need to save copies of your receipts, have your proof your residency, and apply for the refund after Jan. 1, 2020 for purchases made between Monday, July 1, 2019 and Dec. 31, 2019. You’ll have to have paid at least $25 in Washington state sales tax to qualify. Local sales taxes are not factored into the reimbursement.
The state is banking on getting an additional $175 million into the state treasury through the middle of 2025.
[Read the State of Washington Department of Revenue’s new tax exemption rules]
