Washington: Renewable Energy Sales and Use Tax Exemption

In Washington State, there is a 75% exemption from tax for the sales of equipment used to generate electricity using fuel cells, wind, sun, biomass energy, tidal or wave energy, geothermal, anaerobic digestion or landfill gas. The tax exemption applies to labor and services related to the installation of the equipment, as well as to the sale of equipment and machinery. Eligible systems are those with a generating capacity of at least 1 kilowatt (kW).  Purchasers of the systems listed above may claim an exemption in the form of a remittance.  Solar energy systems 10 kW or less are eligible for a 100% exemption from sales and use tax. Purchasers of these systems can provide the seller with an exemption certificate to avoid paying the sales and use tax.  In May 2009, Washington passed SB 6170, effective July 1, 2009. This legislation extended the expiration date of these exemptions until June 30, 2013.