On July 1, 2008, the destination sales tax went into effect. The destination sales tax was set up so, if a retailer (seller) sold something (purchaser), and the item(s) was to be delivered to the purchaser in a different city or county, the retailer would charge the sales tax applicable to the delivered city/county and then pay that sales tax to that city/county. If the purchaser was to take the item(s) with them (not have it delivered by a third party), then the sales tax would be determined by the tax applicable to the location of the seller and the sales tax would be paid to the seller’s city/county.
This distribution of the sales tax to the destination city/county was long overdue, but it fell short of what should have been in the law. Since each transaction has a buyer and a seller, both of whom bring benefits to the transaction, why is 100% of the sales tax being paid to the destination city/county, when the selling city/county is an equal party to the transaction, but the selling city/county receives none of the applicable sales tax. Right now the destination city/county gets 100% of the sales tax and the selling city/county gets 0%. Is it not more equitable for both the purchasing city/county and the selling city/county to split the sales tax equally, 50/50.
Splitting the sales tax 50/50, as to the purchaser and the seller locations, can easily be accomplished today with computers that are doing the work anyway. We all have 9 digit zip codes for our street, city/county address. (It is on our driver’s license.) I suggest the Washington State Senate and/or House, make this modification to the sales tax distribution without any delay, so that all of the parties, the purchasing city/county and the selling city/county, to the transaction get an equal and equitable share of the sales tax. The sales tax charged should be based upon the seller’s location, to keep it simple.
Retired tax attorney