Shoppers with Oregon ID will lose their Washington sales tax exemption as they’ve known it under a bill approved over the weekend in Olympia.
Starting in July, the sales tax exemption for Oregon residents and some others, such as British Columbia residents, will no longer be in effect, according to the provisions of the bill, which was passed as part of the two-year state budget.
Starting in January, Oregon residents will need to submit an annual application to the Washington Department of Revenue to receive a reimbursement of paid state sales taxes totaling $25 or more. Only one application per calendar year will be allowed.
The Washington sales tax is 6.5 percent. There will be no reimbursement for local sales taxes. A state revenue department spokeswoman said further details have yet to be worked out.
The state anticipates the change will generate nearly $53 million in fiscal years 2020-21.
The change comes after at least five years of off-and-on attempts to alter or eliminate the sales tax exemption. The previous proposals often featured Washington retailers along the Columbia River saying the exemption was necessary to keep them competitive with sales tax-free Oregon. Proponents said the exemption was unfair and a drain on potential money for Washington.