Cigarettes, tribal contracts

From the 2024 DOR Tax Exemption Study

82.08.0316; 82.12.0316 - Cigarettes, tribal contracts Description Sale or use of cigarettes by an Indian retailer is exempt from sales and use taxes if its tribe has a cigarette tax contract or agreement with the state of Washington. Purpose To resolve conflicts over contraband cigarettes; to benefit the state of Washington and tribes; to improve law and order; and to reduce the competitive advantage of tax-free cigarettes. Cigarette contracts between the state of Washington and Indian tribes are intended to provide consistency in the regulation and taxation of cigarettes. Taxpayer ($ in millions): savings FY 2024 FY 2025 FY 2026 FY 2027 State Taxes $14.200 $14.200 $14.200 $14.200 Local Taxes $6.400 $6.400 $6.400 $6.400 Repeal of Repealing this exemption would not increase revenues, as that would violate the exemption contractual agreement. Potential ($ in millions): revenue gains FY 2024 FY 2025 FY 2026 FY 2027 from full repeal State Taxes $0.000 $0.000 $0.000 $0.000 Local Taxes $0.000 $0.000 $0.000 $0.000 Assumptions The state will not impose its cigarette and sales and use taxes on these products, as the tribes are already imposing their own equivalent taxes under the contracts.