Washington state fees and taxes

[CarinaPDX]

It looks like the Hawaii sales tax rate is about half of the Washington sales tax rate. If you can argue that the market value is half that you paid sales tax on you won't owe anything. Otherwise it still might be quite small. OTOH if you never paid sales tax you might want to enjoy cruising in Canada - my recommendation to my fellow Oregonians.

Greg

[CarinaPDX]

Originally Posted by BB Bosun Mate

few question on this subject
1. Who enforce these rule/regulation?

The state has officers that visit the marinas by land and small boat. Also, they have an 800 number so best not to piss off anyone...

2. How do the determine that when was you actually enter the state of Washington. If you not telling them.

Which is why they have the other rules. The Use tax is owed at 60 days if you don't apply for a temporary Washington vessel ID, which must be done in the first 60 days or you pay tax+penalty. You also have to apply for a cruising permit before 60 days. Both applications will ask for the date of entry - I wouldn't recommend risking tax fraud.

As for knowing date of entry, the state uses the USCG data for entry from Canada, and Strait of Juan de Fuca. If they start looking they will find out, even if you don't stay in a marina.

If you are too worry about that then sail your vessel out to international water for a day and then return to port. it only 12 miles off shore

No. It is 180 days in a year. That won't work.

The legal work-around is to go from Hawaii to Canada and enjoy amazing cruising, then enter Washington and enjoy for 180 days, then either return to Canada or make the short trip to Oregon for the off-season. Newport would be easy to get to and has good facilities.

Greg

[Gudgeon]

BB Bosun Mate
Not sure how they enforce the rules. I would not have to clear in to Washington with any law enforcement agency. Not sure if the Marine vessel traffic system for Puget sound would log me in. I am not sure that going to international waters for a day resets the clock.

CarinaPDX
Yep spending my cruising dollars in Canada is looking more likely. Spend less than 60 days on the way in spend a year in Canada spend and less than 60 days on the way out. We did off shore delivery so no sale taxes were paid.

[CarinaPDX]

The USCG monitors the border like an insomniac hawk. They are watching for boats not reporting to customs especially (there is a long history of smuggling low-tax alcohol and tobacco north, and pot south). That data is available to the state. They also watch the Strait closely, and report all vessel traffic. The Strait has a VTS, and anyone not reporting to it or fitted with an AIS transceiver will likely get a visit from a patrol boat during the 80 mile transit. Again, the data is available to the state. Trust me, they know...


I wouldn't feel constrained to 60 days - the cost for the extension is not too bad. Just be aware that you must file, and that filing will confirm the date by which you must be gone.


Greg

[Stu Jackson]

Originally Posted by CarinaPDX

Agree that you should read the recent thread - starting an identical thread only a few days later than another active thread with many informative posts just shows that you didn't search first. Not meaning to be rude, just pointing out proper "netiquette". And explaining why I am not going to repeat my research again here...


Greg

Thanks, Greg. So true.


This from a guy who has owned this boat for 20 years now, sailed up from SF to BC in 2016, licensed and legal in BC now with a PCOC, too, imported the boat and paid 12% import tax on comp values from website ads for my 1986 boat, and right now I'm maybe ten nautical miles from WA State with a visiting friend from Everett. So there!

[Montanan]

Gudgeon, use tax is not complicated and are routine. First determine if you owe such and then determine if you can utilize exemptions to the use tax, or in the alternative purchase a Use Permit in Washington, which have limited duration and types of permitted uses. However, you state that you intend to be in Washington waters for two summers which is longer then the one year limit provided by a Use Permit which Use Permit costs $500 or $800 depending on boat length. At the end of the one year Use Permit you would need to leave Washington for two complete years [24 months] before returning to Washington waters, else the Use tax will become due upon reentry during the 24 month period, likely calculated at the then market value of your vessel.

Reference the details in the recent thread on the same subject matter and the links provided in this redundant thread, e.g., Washington's excise tax 0.5%. If you wander up to Canada beware your length of stay and the temporary import [again one year] / permitting requirements so as to avoid the new retaliatory tariff duty [10%] [i.e., Canada's Trump tax] and the GST/PST which I believe totals 12% in British Columbia, which together total 23.2% of the imported value of the boat at time of entry. Additonally, there will be visa issues if you stay long enough to trigger the Canadian taxes.

To reiterate:
What is use tax?
Use tax is a tax on the use of goods or certain services in Washington when sales tax has not been paid. Goods used in this state are subject to either sales or use tax, but not both. Thus, the use tax compensates when sales tax has not been paid.


When is use tax due?
Use tax is due if:

Goods are purchased in another state that does not have a sales tax or a state with a sales tax lower than Washington’s. For example, items you purchase in Oregon that are used in Washington are subject to use tax.
Goods are purchased from someone who is not authorized to collect sales tax. For example, purchases of furniture from an individual through a newspaper classified ad or a purchase of artwork from an individual collector.
Goods are purchased out of state by subscription, through the Internet, or from a mail order catalog company. Many of these companies collect Washington’s sales tax, but if the company from which you order does not, you owe the use tax.
Personal property is acquired with the purchase of real property.

How do I pay use tax?
Use tax is determined on the value of the goods when first used in Washington. Generally, this is the purchase price. However, a depreciated value may be determined if the goods are used outside the state for a lengthy time before use in Washington by the same person. Use tax is also due on any freight, delivery, or shipping charges paid to the seller.

The use tax rate is the same as your sales tax rate. To determine the correct rate for your area, check out our Local Sales Tax Rates or try our Tax Rate Lookup Tool. Use tax, unlike sales tax, is due at the rate applicable to where you first use the article [which county / city], not where the sale takes place.

Enjoy sailing the Salish Sea and Puget's Sound. All the best from the Last Best Place where we don't have any sales or use taxes.