Amounts the state is prohibited from taxing

From the 2024 DOR Tax Exemption Study

Det. No. 04-0232, 24 WTD 230 (March 31, 2005) 239 conclude that Xerox’s description of the goods as “in transit” is not relevant to our Import-Export Clause analysis. We conclude that, even if we were to find, contrary to Reynolds, that the goods in the [State A] FTZ were “in transit,” the goods were no longer “in transit” when they left the FTZ to enter their state of destination, Washington. Because the B&O tax is not a property tax on goods “in transit,” we conclude that the Michelin analysis applies. Accordingly, we find that the United States Constitution does not bar the Department from assessing wholesaling B&O tax with respect to sales of imported goods to Washington customers. Taxpayer’s petition as to the Import-Export Clause is denied. [3] 3. Rule 193C. Washington’s B&O tax is a tax on the privilege of engaging in business in this state. RCW 82.04.220. The rate and the measure of the tax depend on the type of business activity being taxed. Id. With regard to wholesaling activities, the tax is calculated by multiplying a rate times the gross proceeds from sales in this state. RCW 82.04.270. Taxable sales take place in this state if the goods are delivered to the purchaser