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Logging
Extracting: The felling, cutting (severing), or taking of trees is an extracting activity. The extracting B&O tax applies to the value of the products, which is the value of the severed trees prior to any cutting, delimbing, or other manufacturing activity. RCW 82.04.100
Manufacturing: The cutting, delimbing, and measuring of felled, cut, or taken trees is a manufacturing activity. The manufacturing B&O tax applies to the value of the products, which is generally the gross proceeds of sale, whether the manufactured product is sold at retail or wholesale. RCW 82.04.120
Mining & quarrying
Extracting: Mining and quarrying operations are extracting activities, and generally include the screening, sorting, and piling, of rock, sand, stone, gravel, or ore. For example, an operation that extracts rock, then screens, sorts, and with no further processing places the rock into piles for sale, is an extracting operation.
Manufacturing: The crushing and/or blending of rock, sand, stone, gravel, or ore are manufacturing activities. These are manufacturing activities whether or not the materials were previously screened or sorted.Screening, sorting, piling, or washing of the material, when the activity takes place in conjunction with crushing or blending at the site where the materials are taken or produced, is considered a part of the manufacturing activity if it takes place after the first screen. If there is no separate first screen, only those activities subsequent to the materials being deposited into the screen are considered manufacturing activities.
However, rock crushing performed by the same business that is hired to perform road building (public roads or logging roads) is not an activity that qualifies for the manufacturer’s tax exemption since the product (the crushed rock) is not sold as tangible personal property but is instead applied to the road being built.
