It's a slightly disturbing headline, but all the pieces come together in a Washington State Department of Revenue notice on "how retail sales or use tax applies to chemicals used to treat drinking water."
The rule is uncharacteristically succinct:
- Chemicals that are consumed in the process of treating drinking water, and do not remain in the water when it is delivered to the customer, are subject to sales tax or use tax." (Emphasis mine). The example provided is ozone.
- Chemicals that remain in the water after treatment, and are present in the water delivered to customers, can be purchased without paying sales or use tax. (Emphasis mine). The examples provided are fluoride and chlorine.
A valid reseller permit is required in order to claim the sales or use tax exemption.
Anyone who has erroneously paid Washington State sales or use tax on exempt chemicals may apply for a refund online.
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Avalara Author
Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.