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Tax Incentives

Fife's Low Tax Rate
Opening a Business in Fife Checklist

Warehouse & Distribution Incentive
Warehouse Tax Incentive- More info
  Who: Wholesalers, retail distribution centers, third-party warehousers, cold storage warehousers; Sales tax paid on:
  • Construction of a 200,000 square foot warehouse or distribution center or a grain elevator with a one million bushel capacity
  • Construction or expansion of a cold storage warehouse by at least 25,000 square feet (effective July 1, 2007)
    What: A remittance of 100% of state sales tax (6.5%) paid on construction of qualifying structures; 50% remittance for state sales tax paid on qualifying equipment.
Manufacturers and Food Processor Incentives
Manufacturing Machinery Sales & Use Tax Exemption- More info   Who: Manufacturers, processors for hire, manufacturers who perform R&D.
What: Exempts sales and use tax on machinery and equipment used directly in manufacturing or research operations. Includes installation, maintenance, and repairs in most cases.
     
Food Processing Tax Incentives- More info
  Who: Manufacturers and processors of fresh fruit & vegetables, dairy products, and seafood products.
What:
  • B&O tax exemption for goods destined for outside Washington.
  • Defers or waives sales and use tax on machinery and equipment, construction costs for new or expanded facility. (Effective 7-1-07)
  • Expands the warehouse remittance program to include cold storage warehouses or fresh fruit & vegetables, dairy products, and seafood products. (Effective 7-1-07)
Green Incentives
Solar Energy System Manufacturers & Wholesalers - Reduced B&O Tax rate- More info
  Who: Manufacturers, processors for hire, or wholesalers of solar energy systems using photovoltaic modules or silicon components of these systems.
What: The B&O rate is lowered from 0.484 percent to 0.2904 percent

Machinery & Equipment Used to Generate Electricity Using Renewable Energy - Sales- More info

  Who: Individuals, businesses, and local government entities that generate electricity using fuel cell, wind, landfill gas, or solar energy.
What: Sales/use tax exemption on purchase or lease of machinery and equipment used directly in generating electricity using fuel cells, wind, landfill gas, or solar energy as the principal source of power.

Solar Hot Water Equipment - sales and use tax exemption -More info

  Who: Individuals & businesses
What: Sales/use tax exemption on Purchases of OG-300 rated solar water heating systems, OG-100 rated solar water heating collectors, solar heat exchangers, or differential solar controllers;
  • Charges for repair and replacement parts for such equipment;
  • Charges for labor and services for installing, repairing, cleaning, altering, or improving such equipment.
Energy production using solar, methane & wind power - cost recovery program- More info
  Who: Individuals, businesses, and local government entities that are not in the light and power business or gas distribution business. Light and power company may take public utility tax credit for amounts paid to participants. Participants must generate electricity on their own property with an anaerobic digester or a wind or solar energy system and apply to their light and power company for a cost recovery incentive payment.
What: Cost recovery on investment (up to $2,000)
Energy efficient commercial equipment -B&O tax credit for purchases- More info
  Who: Businesses with a gross income of less than $750,000 in the previous year.
What: A B&O tax credit equal to 8.8% of the purchase price on the purchase of qualifying energy efficient equipment.

Weatherization assistance program -sales/use tax exemption- More info
  Who: Community Trade and Economic Development (CTED) weatherization program contractors.
What: Sales/use tax exemption on purchase of tangible personal property that becomes a component part of a qualifying residence under the weatherization program administered by CTED. Examples of qualifying weatherization materials include, but are not limited to the following:
  • Insulation and sealants
  • Parts for air infiltration
  • Heating and cooling equipment
  • Supplies used to seal and repair ducts
Waste Vegetable Oil- Sales/Use Tax Exemption and Special Fuel Tax Exemption on Purchases for Personal Use- More info
  Who: Any person that is not engaged in selling biodiesel fuel at wholesale or retail.
What: Sales/use tax exemption on Purchase of waste vegetable oil to produce biodiesel fuel for personal use. Waste vegetable oil is used cooking oil gathered from restaurants or commercial food processors.
Reduced B&O Tax Rate for Manufacturing Biodiesel/Alcohol Fuel, etc. - More info
  Who: Manufacturers of alcohol fuel, biodiesel fuel, biodiesel feedstock, or wood biomass fuel.
What: The tax rate for manufacturers of biodiesel fuel, biodiesel feedstock, alcohol fuel, and wood biomass fuel has been reduced from 0.484% to 0.138%.
Property/Leasehold Tax Exemption for Manufacturers of Biodiesel/Alcohol Fuel- More info
  Who: Manufacturers of alcohol fuel, biodiesel fuel, biodiesel feedstock, or wood biomass fuel.
What: Qualifying real and personal property that is operational
and used primarily for manufacturing alcohol, biodiesel or wood biomass fuels is exempt or partially exempt from property tax and leasehold excise tax
B&O Tax Deduction for
Sales of Biofuels- More info
  Who: Retail sellers and distributors of biodiesel fuel, alcohol fuel, and wood biomass fuel.
What: Income received from the distribution or retail sale of biodiesel fuel, wood biomass fuel, or E85 motor fuel may be deducted from gross income reported for B&O tax. Only income attributable to the pure biofuel portion of biodiesel fuel, wood biomass fuel, or E85 motor fuel sold may be deducted. This amount is computed based on the percentage of the product by volume that is the pure biofuel portion of biodiesel, wood biomass, or E85 motor fuel multiplied by the price of the product by volume.
For example, if a fuel blend is 50% pure biodiesel and 50% diesel fuel and sells for $1.50 per gallon, the vendor may deduct $0.75 from gross income for each gallon sold.
Sales/Use Tax Exemption for Machinery/Equipment, Delivery Vehicles & Construction of Facilities for Retail Sales of Biofuels- More info
  Who: Retail sellers of biodiesel fuel, alcohol fuel, and wood biomass fuel.
What: The purchase of machinery and equipment and the construction of facilities used directly for the retail sale of biodiesel fuel blend, E85 motor fuel, and wood biomass fuel blend are exempt from retail sales tax and use tax.
The purchase of fuel delivery vehicles and labor and service charges related to such vehicles are exempt from retail sales tax and use tax provided 75% of the fuel distributed by them is biodiesel fuel blend, E85 motor fuel, and wood biomass fuel blend.
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