TAX NEWS - June 2010

British Columbia Tax: BC Residents To Get Sales Tax Exemption In Washington

Earlier this year, Washington lawmakers considered doing away with sales-tax-free-shopping for some out-of-state visitors.

Now, Washington is going in the other direction. It's adding two Canadian provinces to its sales tax exemption.  Austin Jenkins reprots.

It's already the case that visitors from low and no sales tax states like Alaska and Oregon can flash their driver's licenses to avoid paying sales tax in Washington.

This courtesy to out-of-state shoppers costs the state and county coffers more than $90M a year. But it enjoys such strong support, Washington lawmakers decided not to eliminate it this year despite a major budget crisis.

Meanwhile, British Columbia and Ontario, Canada are adopting a value added tax.

Mike Gowrylow: "Since their sales tax is going away July 1st..."

Mike Gowrylow is with the Washington Department of Revenue.

Mike Gowrylow: "...they become like Oregon as far as their residents being eligible to buy products in Washington without being charged the tax."

The addition of BC would be a blow to the tax base in Whatcom County on the Washington-Canada border.

An official there says the county may challenge the Department of Revenue's interpretation of the law.