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Washington: New Exemptions for Aerospace Industry


 Boeing has decided to build wings for the new 777X in Washington. Tax incentives forthcoming.

New and extended aerospace tax preferences have been announced by the Washington State Department of Revenue. They took effect July 9, 2014.

New sales and use tax exemption

Washington now provides a retail sales and use tax exemption for the construction of new facilities used to manufacture the following:

  • Commercial airplanes
  • Commercial airplane fuselages
  • Commercial airplane wings

Charges for labor and services involved in the construction of new buildings, materials used during the course of construction, and labor and services “rendered in respect to installing building fixtures not otherwise eligible for the exemption” are eligible for the exemption.

Qualifying buyers must present sellers with a “Buyer’s Retail Sales Tax Exemption Certificate” at the time of purchase in order for the exemption to be valid.

Tax incentives extended

In addition to the new exemptions, existing aerospace tax incentives previously set to expire on June 30, 2024, are extended to June 30, 2040.

Coincidence?

According to the DOR, the new exemption and the extended tax incentives “were contingent upon the siting of a significant commercial airplane manufacturing program in Washington.” Hmm, could that be Boeing? In February, Boeing announced that it would construct wings for the new 777x near Everett, Washington.  Now it has seems that “the contingency requirements (for the tax incentives) have been satisfied.”

Additional information is available on a special notice posted on the Washington Department of Revenue website.

How does your business manage sales tax exemptions? Learn about automating the exemption certificate lifecycle.

photo credit: Kesara Rathnayake (kesara.lk) via photopin cc


Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
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.