The State of Virtual Currency in Washington State
- Feb 4, 2015 | Gail Cole
Businesses in Washington State Department of Revenue reminds that retail sales tax and Retailing B&O tax apply to taxable sales of tangible personal property, digital products and certain services even when payment is in virtual currency.
The rate of tax is “measured by the amount accepted in terms of dollars,” which is generally the advertised sales price. The department provides the following example: If a customer pays 0.134 bitcoin for a widget advertised as costing $50, the measure of tax is $50.
If sales tax isn’t collected by the retailer at the time of sale, the buyer is responsible for remitting use tax “on the same taxable value as would apply for retail sales tax.”
Measure of tax not affected by virtual currency fluctuation
The measure of tax remains $50 even if “the virtual currency value fluctuates before the business redeems it.”
Pay taxes with real money
Virtual currencies such as Bitcoin may be gaining in popularity, but they are still not an acceptable form of payment for taxes. Additional information.
Simplify sales tax for all transactions by moving transaction tax management to the cloud. Learn more.