On July 1, 2008, the destination sales tax went into effect. The destination sales tax was set up so if a retailer (seller) sold something, and the item(s) was to be delivered to the purchaser in a different city or county, the retailer would charge the sales tax applicable to the delivered city/county and then pay that sales tax to that city/county.

If the purchaser was to take the item(s) with them (not have it delivered by a third party), then the sales tax would be determined by the tax applicable to the location of the seller and the sales tax would be paid to the seller’s city/county.

This distribution of the sales tax to the destination city/county was long overdue, but it fell short of what should have been in the law.

Since each transaction has a buyer and a seller, both of whom bring benefits to the transaction, why is 100 percent of the sales tax being paid to the destination city/county, when the selling city/county is an equal party to the transaction but receives none of the applicable sales tax? Right now, the destination city/county gets 100 percent of the sales tax and the selling city/county gets zero percent.

Splitting the sales tax 50/50 between the purchaser and seller locations can easily be accomplished today with computers that are doing the work anyway. I suggest the state Senate and/or House make this modification to the sales tax distribution, so that the purchasing city/county and the selling city/county get an equal share of the sales tax.

The sales tax charged should be based upon the seller’s location, to keep it simple.

Mike Lantz
Retired tax attorney
Edmonds