Streamlined Sales Tax

Streamlined Sales and Use Tax Project (SST) is a national effort by state governments, local governments and the private sector to simplify and modernize sales and use tax collection and administration. The Project’s proposals include tax law simplifications, more efficient administrative procedures, and emerging technologies to substantially reduce the burden of tax collection. The Project’s proposals are focused on improving sales and use tax administration systems for both Main Street and remote sellers for all types of commerce.

The Streamlined Sales Tax Governing Board has granted Washington’s petition to officially join the SST effort. The action during the Board’s June 23 meeting in Detroit means Washington joins 21 other states that have partially or fully conformed to the Streamlined Sales and Use Tax Agreement.

Sourcing attributes a sale to a specific taxing jurisdiction in order to determine the tax rate to charge.

To achieve uniformity among all states in the collection of sales tax, sellers are required to source sales on a destination/delivery basis. Under SST, sourcing changes from the “point of sale” to the “point of delivery.” This improves fairness in distribution of tax revenues by returning revenues closer to taxpayers.

SSB 5089 created the streamline sales and use tax mitigation account to mitigate the effect of the new sourcing rules to negatively impacted local jurisdictions. On July 1, 2008, the State Treasurer must transfer $31.6 million into the account from the General Fund. Each July 1 thereafter, the Treasurer must transfer an amount determined by the Department of Revenue to fully mitigate negatively impacted local jurisdictions.

The Department of Revenue has information to help businesses with the SST changes.  Click here to see their flyer.  Click here to see their fact sheet.

SSB 5089 Bill Report:

 http://wsldocs/2007-08/Pdf/Bill%20Reports/Senate%20Final/5089-S.FBR.pdf