WAC 179

Taxicabs and Limousines

Nonprofit Organizations

"Gross Income of Business"

Exemptions -- Public utilities -- Electrical energy -- Natural or manufactured gas.

PUBLIC UTILITY TAX

Definitions

Public utility tax imposed -- Additional tax imposed -- Deposit of moneys.

Deduction in computing tax.

Light or power and gas distribution businesses -- Information required on customer billings.

B&O and PUT exemptions for farm services

WAC 458-20-179 Public utility tax; 458-20-17901 Public utility tax-Energy conservation and cogeneration deductions; 458-20-180 Motor carriers The Department is amending WAC 458-20-179 and 180 for general updating and reorganization of the information in the rules. WAC 458-20-17901 is being repealed as no longer needed, as relevant deduction information has been incorporated into Rule 179. Information pertaining to legislation SSB 6614 (chapter 295, Laws of 2010) has been added to Rule 179.

Public utility tax explains the public utility tax (PUT) imposed by chapter 82.16 RCW. The Department has revised Rule 179 to include in the list of rules in the Introduction a reference to WAC 458-20-13501 Timber harvest operations and the words “log transportation” in Part I (101).

WAC 458-20-179 Public utility tax explains the public utility tax (PUT) imposed by chapter 82.16 RCW. The PUT is a tax for engaging in certain public service and transportation businesses within the state. The Department is amending Rule 179 to include language that explains the PUT exemption for income from sales by a gas distribution business of natural gas, compressed natural gas, and liquefied natural gas used for transportation purposes. This exemption is from legislation ESSB 6440 (chapter 216, Laws of 2014) and is not effective until July 1, 2015.

Public utility tax.Effective 7/7/94

BERTHAGE AND MOORAGE CHARGES SUBJECT TO PUBLIC UTILITY TAX

GROSS INCOME OF PUBLIC UTILITY DISTRICTS - LOCAL TAXES INCLUDED - The latest revision of WAC 458-20-195 (Taxes, deductibility), effective August 21, 2000, specifically lists this tax as an example of a tax that is not deductible when determining the measure of tax. Cancelled by ETA 2003-3s 02/15/2001

Low-density light and power utility deduction (7th Revision) Cancelled 6/21/05

6th Revision - Low-Density light and power utility deduction Cancelled 6/29/04

LOW-DENSITY LIGHT AND POWER UTILITY DEDUCTION This document is annually revised to provided the state average electric power rate for the purpose of computing the public utility tax deduction provided by RCW 82.16.053. Adopted and became effective June 28, 1999, though the new rate applies only for the period of July 1999 through June 2000. It is not a rule and therefore there is no 31 day period between adoption and effective dates. Revised 6/01/00

Low-density Light and Power Utility Deduction (9th Revision) Cancelled 5/23/07

5th Revision - LOW DENSITY LIGHT AND POWER UTILITY DEDUCTION (Revised annually) Cancelled 6/24/03

Low-density Light and Power Utility Deduction (10th Revision) The Department of Revenue has issued a revised Excise Tax Advisory 2002.16.179 Low-density light and power utility deduction (ETA 2002). This advisory explains the public utility tax deduction provided by RCW 82.16.053 to qualifying power and light businesses. RCW 82.16.053 requires that the Department determine the state average electric power rate each year and inform taxpayers of this rate. This rate is used by the power and light business to compute the amount of the deduction.

Low-density light and power utility deduction (8th Revision) Cancelled 6/19/06

Taxability of air transportation and other activities performed with aircraft Revised 2/2/09 See ETA 3056.2009

WHERE INTERSTATE COMMERCE ENDS AND INTRASTATE COMMERCE BEGINS. The information in this document is unnecessary. WAC 458-20-193 (Inbound and outbound interstate sales of tangible personal property) addresses this issue. Cancelled by ETA 2003 -0 6/30/99.

SALES OF NATURAL GAS TRANSPORTED FROM ORIGINS WITHOUT THE STATE TO POINTS WITHIN THE STATE Revised 2/2/09 See ETA 3090.2009

Berthage and moorage charges subject to public utility tax

Low-density light and power utility deduction

Low-Density Light and Power Utility Deduction - The Department of Revenue has revised Excise Tax Advisory 3043.2009 Low-density light and power utility deduction (ETA 3043). This advisory explains the public utility tax deduction provided by RCW 82.16.053 to qualifying power and light businesses. RCW 82.16.053 requires that the Department determine the state average electric power rate each year and inform taxpayers of this rate. This rate is used by the power and light business to compute the amount of the deduction.

Low-density light and power utility deduction The Department of Revenue has revised Excise Tax Advisory 3043.2009 Low-density light and power utility deduction (ETA 3043). This advisory explains the public utility tax deduction provided by RCW 82.16.053 to qualifying power and light businesses. RCW 82.16.053 requires that the Department determine the state average electric power rate each year and inform taxpayers of this rate. This rate is used by the power and light business to compute the amount of the deduction.

Low-density light and power utility deduction The Department of Revenue has revised Excise Tax Advisory 3043 (ETA 3043). This advisory explains the public utility tax deduction provided by RCW 82.16.053 to qualifying power and light businesses. RCW 82.16.053 requires that the Department determine the state average electric power rate each year and inform taxpayers of this rate. This rate is used by the power and light business to compute the amount of the deduction.

Low-Density Light and Power Utility Deduction

Low-density light and power utility deduction The Department of Revenue has revised Excise Tax Advisory 3043 (ETA 3043). This advisory explains the public utility tax deduction provided by RCW 82.16.053 to qualifying power and light businesses. RCW 82.16.053 requires that the Department determine the state average electric power rate each year and inform taxpayers of this rate. This rate is used by the power and light business to compute the amount of the deduction.

Low-density Light and Power Utility Deduction The Department of Revenue has revised Excise Tax Advisory 3043. This ETA explains the public utility tax deduction provided by RCW 82.16.053 to qualifying power and light businesses. RCW 82.16.053 requires that the Department determine the state average electric power rate each year and inform taxpayers of this rate. This rate is used by the power and light businesses to compute the amount of the deduction. The revised ETA 3043 updates the information to provide the rate to be used for the period of July 2014 through June 2015.

Low-Density Light and Power Utility Deduction The Department of Revenue has revised Excise Tax Advisory (ETA) 3043. This ETA explains the public utility tax deduction provided by RCW 82.16.053 to qualifying power and light businesses. RCW 82.16.053 requires that the Department determine the state average electric power rate each year and inform taxpayers of this rate. This rate is used by the power and light businesses to compute the amount of the deduction. The revised ETA 3043 updates the information to provide the rate to be used for the period of July 2015 through June 2016.

Use tax modification to aircraft dealers

Taxability of air transportation and other activities performed with aircraft

Sales of natural gas transported from origins without the state to points within the state

Withdrawal of published determinations The Department has re-issued this ETA to announce that it has withdrawn two Determinations: Det. No. 00-064, 19 WTD 1013. The taxpayer in this determination was a private, for-profit transportation company that provided ride sharing services for persons with special transportation needs (“paratransit services”). It leased paratransit vehicles from a transit authority and requested a refund from PUT under RCW 82.16.047.

Taxable transactions by aircraft dealers

Taxable Transactions by Aircraft Dealers The Department of Revenue has revised Excise Tax Advisory (ETA) 3151. This advisory explains how certain transactions by aircraft dealers are taxable. Example 4 of the ETA incorrectly stated that the portion of monthly rental charges attributable to out-of-state use by the lessee can be deducted from the measure of tax. This information is out of date and incorrect.

TAXABLE TRANSACTIONS BY AIRCRAFT DEALERS Revised 2/2/09 See ETA 3151.2009

AIR TAXI SERVICE, CHARTER FLIGHTS AND STUDENT TRAINING FEES - Revised 4/1/91. Much of the content of this document is either incorrect (e.g., tax-reporting instructions for air ambulance services and sightseeing), or addressed in other rules (e.g., WAC 458-20-179 and WAC 458-20-209). Cancelled by ETA 2003 -4s 09/06/01. A new ETA 2006.16.179 was adopted to provide updated information in this area.

AIR TAXI SERVICE, CHARTER FLIGHTS AND STUDENT TRAINING FEES - Cancelled by ETA 2004-4s 09/06/01 a new ETA 2006.16.179 was adopted to provide updated information in this area.

EXEMPTION REQUIREMENTS FOR CERTAIN GRAIN HAULS BY TRUCK - Revised 9/1/84 and later Cancelled 11/30/07

EXEMPTION REQUIREMENTS FOR CERTAIN GRAIN HAULS BY TRUCK Cancelled effective 11/30/07. This document provides that income from certain intermediate hauls of grain to interim storage facilities may be deducted when determining the measure of income subject to PUT. ETA no longer needed. Chapter 330, Laws of 2007 (HB 1443) provides specific statutory deduction for these hauls. This legislation is not limited to hauling of grain, but applies to the hauling of agricultural commodities.

DEDUCTION REQUIREMENTS FOR CERTAIN LOG HAULS BY TRUCK - This document explains tax-reporting requirements associated with log hauls to export facilities. This document is no longer needed because this issue is addressed in WAC 458-20-13501. Cancelled by ETA 2003-3s 07/16/2001

LOW-DENSITY LIGHT AND POWER UTILITY DEDUCTION Cancelled by ETA 549 (Third Supplement) 6/30/98

Electric Utility Tax Credit for Rural Economic Development Revolving Fund

Non-Profit Water Associations

Public Utility Tax Credits for "Billing Discounts" and "Qualifying Contributions"

Public Utility Tax Deductions for Water Conservation Measures

Department Authority to Disregard Tax Avoidance Transactions

Renewable Energy Cost Recovery Incentive Program, Modifications to Program

Electric Utility Tax Credit Program Changes

Tax Incentives for the Production of Solar, Methane and Wind Power

Public Utility Tax Credits Available for "Billing Discounts" and "Qualifying Contributions"

Electric Utility Tax Credit for Rural Economic Development Revolving Fund

Public Utility Tax Credits for "Billing Discounts" and "Qualifying Contributions"

Public Utility Tax Credit

Public Utility Tax Deduction for Certain Transportation Activities with Respect to Agricultural Commodities. Notice: Truckers remain liable for PUT and B&O taxes

Truck Stop and Diesel Truck Owners - Tax Incentives

Reduced public utility tax rate for log transportation businesses

B&O Tax Exemption for Sales of Natural and Manufactured Gas by Industrial Users

Brokered Natural Gas Use Tax Imposed Where the Gas is Burned or Stored

Public Utility District (PUD) Privilege Tax "Gross Revenue" Term Clarified

Excise Tax Exemption for Small Water Districts and Small Irrigation Districts

Electric Utility Tax Credit for Rural Economic Development Revolving Fund

City-imposed Municipal Utility Taxes are Part of Taxable Gross Income

Small Water-Sewer and Irrigation Districts/Systems Exemptions Expire

B&O Tax Exemption for Sales of Natural and Manufactured Gas by Industrial Users

Electric Utility Tax Credit for Rural Economic Development Revolving Fund

Public Utility Tax Credits for "Billing Discounts" and "Qualifying Contributions"

Sales & Use Tax Exemption for Light & Power Businesses

Electric Utility Tax Credit for Rural Economic Development Revolving Fund

Public Utility Districts can produce and sell renewable natural gas

Electric Utility Tax Credit for Rural Economic Development Revolving Fund

Reduced Public Utility Tax Rate for Log Trucks

B&O Tax Exemption for Sales of Natural and Manufactured Gas by Industrial Users

Public Utility Tax Credits for "Billing Discounts" and "Qualifying Contributions"

Electric Utility Tax Credit for Rural Economic Development Revolving Fund

Public Utility Tax -- Railcar Switching By Taxpayer For Itself.A corporate which received income from a railroad for switching railroad cars loading its products with its own engine on its own siding was taxable under the service B&O classification of RCW 82.04.290 and was not taxable as a public utility.

PUBLIC UTILITY TAX -- TAXICABS -- URBAN TRANSPORTATION.Income received by taxi cab business from transporting elderly and physically challenged passengers is subject to public utility tax, just like income from other passengers is taxed.

PUBLIC UTILITY TAX -- TAXICABS -- URBAN TRANSPORTATION.The taxpayer's gross receipts from the taxi business are subject to the public utility tax with no deductions for compensation paid to drivers, who were under taxpayer's direction and control.

PUBLIC UTILITY TAX -- TAXICABS -- URBAN TRANSPORTATION.Cab operator's income from contracting with local public transportation agencies to provide transportation services to segments of public is taxable

EXPORT TRANSPORTATION -- WHAT CONSTITUTES -- INTERVENING TRANSPORTATION.When a carrier is obligated to deliver goods to an export dock on a through bill of lading for export, the charges by the obligated carrier are exempt from B&O tax as export transportation.

PUBLIC UTILITY TAX -- WATER SYSTEM -- "SOLELY FOR IRRIGATION PURPOSES." Where a water district supplies a community with water and some of the water is used for open space, the deduction for water distributed "through an irrigation system" does not apply. Legislation is deemed to know the ramifications of its acts and is presumed not to engage in frivolous acts.As a result, enactment of a statute addressing "irrigation systems" specifically cannot be broadened to mean all water used to irrigate open space.

This determination has been overruled or modified in whole or part by Det.No. 98-208, 19 WTD 332 (2000) & Det.No. 98-187, 19 WTD 328 (2000).

This determination has been overruled by the holding in Alderwood Water District v. State of Washington, No. 91-2-02722-03 (Thurston County Sup. Ct. 1993).

PUBLIC UTILITY TAX -- WATER DISTRIBUTION.A water district's revenue is taxable gross income when received as monthly payments from customers for water distribution services rendered.Accord:Kennewick v. State, 67 Wn.2d 589 (1965), Seattle v. State, 12 Wn.App. 91 (1974), Det. No. 87-63, 2 WTD 285 (1987).

PUBLIC UTILITY TAX -- CAR HIRE RECEIPTS- THE RAILROAD REVITALIZATION AND REGULATORY REFORM ACT -- CONSTITUTIONALITY.Whether the Public Utility Tax violates the Railroad Revitalization and Regulatory Reform Act and is, therefore, unconstitutional is an issue beyond the authority of an administrative agency to decide.It is solely for the courts.

MOTOR TRANSPORTATION PUBLIC UTILITY TAX -- DEDUCTIONS -- EXPORT LOGS -- IN THEIR ORIGINAL FORM -- DEBARKING OF LOGS.There is a deduction from the gross income subject to the Public Utility Tax for amounts received for hauling commodities/logs to the export facility when the commodities/logs are forwarded, without intervening transportation, by vessel, in their original form, to interstate or foreign destinations.The removal of bark from the hauled logs after delivery to the export facility is a change in the form of the logs and negates the deduction.

PUT -- LIGHT AND POWER BUSINESS -- OPERATING.Operator of a hydro plant, not the owner is liable for public utility tax.This determination has been overruled or modified in whole or part by Det. No. 99-011R, 19 WTD 423 (2000).

PUBLIC UTILITY TAX -- MOTOR TRANSPORTATION -- PLACE OF SERVICE -- INTERSTATE COMMERCE INTERSTATE BILL OF LADING -- ABSENCE THEREOF.When a taxpayer is paid for hauling entirely within Washington absent an interstate bill of lading, it is subject to Motor Transportation (or Urban Transportation) public utility tax. Proof that the property itself is the subject of an interstate or foreign transaction, absent a through bill of lading across state lines, does not qualify for deduction.

PUBLIC UTILITY TAX -- DEDUCTIONS -- JOINTLY PROVIDED SERVICES.Where a P.U.D. purchases filtered water from another district, the P.U.D. is purchasing a commodity, filtered water, for resale and is not providing a jointly provided service even though the other district separately itemizes the filtration costs.

PUBLIC UTILITY TAX -- DEDUCTIONS -- IRRIGATION.Where a water district supplies a community with filtered, potable water and some of the water is used for watering landscaping, the deduction for water distributed through an "irrigation system, for irrigation purposes" does not apply.The term "irrigation" commonly connotes the artificial watering of agricultural lands and not landscaped grounds.A customer's addition of a separate meter and backflow device does not convert the system into an irrigation system.

This determination has been overruled or modified in whole or part by Det.No. 98-208, 19 WTD 332 (2000) & Det.No. 98-187, 19 WTD 328 (2000).

PUBLIC UTILITY TAX -- EXEMPTION -- SERVICE CHARGES -- CONTRIBUTIONS IN AID --CAPITAL FACILITIES -- BONDED INDEBTEDNESS.The initial commingling of rate revenues with other revenues in an operating or maintenance fund does not result in a full or partial loss of the deduction so long as the source and purpose of the funds transferred into a revenue bond fund can be traced with certainty.

PUBLIC UTILITY TAX -- DEDUCTIONS -- CONTRIBUTIONS IN AID -- CAPITAL FACILITIES.A P.U.D. does not satisfy the first of the three criteria set forth inDet. No. 89-451, 8 WTD 195 (1989)where there is no public identification of amounts or percentages levied for specific capital facilities expenditures.If the three criteria are otherwise satisfied, the timing of transfers into a revenue bond fund in order to satisfy other business concerns does not affect the availability of the deduction.

PUBLIC UTILITY TAX -- B&O TAX -- WASTE COLLECTION -- WASTE TREATMENT -- ALLOCATION.Until waste has been carried to a common point or points within a system, the activity is a collection activity for tax purposes. An engineer's analysis not based on this distinction cannot be used to allocate income between waste collection and waste treatment.

This determination has been overruled or modified in whole or part by Det.No. 98-208, 19 WTD 332 (2000) & Det.No. 98-187, 19 WTD 328 (2000).

PUBLIC UTILITY TAX -- DEDUCTIONS -- IRRIGATION.Where a water district supplies a community with filtered, potable water and some of the water is used for watering landscaping, the deduction for water distributed through an "irrigation system, for irrigation purposes" does not apply.The term "irrigation" commonly connotes the artificial watering of agricultural lands and not landscaped grounds.

PUBLIC UTILITY TAX-- EXEMPTIONS -- DEDUCTIONS -- WATER DISTRIBUTION BUSINESS -- HOMEOWNERS' ASSOCIATION.Fees received by homeowners' association for the operation and improvement of a water delivery system are subject to public utility tax.

PUT -- DEDUCTIONS -- SERVICES FURNISHED JOINTLY.In order for payments by one taxpayer to another to qualify for a deduction from gross income under the PUT as "services furnished jointly by both," the payor must demonstrate that it did more than merely purchase the services and pass the cost on to its customers.

SEWERAGE SERVICES -- ALLOCATION -- PUBLIC UTILITY TAX -- B&0 TAX.For purposes of allocating gross receipts from all sewerage related activities between the PUT and B&O tax classifications, "sewerage collection" terminates when the sewage reaches a common point, or points, for disposal or for transfer to treatment for disposal.A lift station qualifies as a common point for transfer to treatment for disposal only if the sole function of the station, and the pipe downstream from the station, is to transmit sewage to a treatment plant.

PUBLIC UTILITY TAX -- ELECTRIC SERVICE -- CONTRIBUTIONS IN AID OF CONSTRUCTION -- BPA -- WPPSS.Electric utilities may not exempt receipts for electric service that they attribute to capital facilities owned either by BPA or WPPSS.

PUBLIC UTILITY TAX -- WATER TRANSPORTATION BUSINESSES NOT SUBJECT TO STATE CONTROL.Water transportation businesses which are not specifically mentioned in subdivisions (1) - (9) of RCW 82.16.010.9(10) and are not subject to control by the state or declared by the legislature to be of a public service nature are not taxable as an "other public service business" under the Public Utility Tax.

B&O TAX --PUBLIC UTILITY TAX -- FEDERAL PRE-EMPTION -- AIR COMMERCE -- AIR AMBULANCE SERVICE:Income earned by an air ambulance service from the carriage of patients in air commerce (including interstate flights and intrastate ones, fixed wing or helicopter) is exempt by federal law from gross receipts taxes, such as the B&O tax and the public utility tax.Income from interstate non-passenger flights where only body organs, supplies, equipment, or other freight is transported is exempt by state law from the B&O tax and the public utility tax.Income earned from purely intrastate no

REFUSE COLLECTION BUSINESSES -- SOLID WASTE COLLECTION BUSINESSES -- PUBLIC SERVICE BUSINESSES -- BUSINESS AND OCCUPATION TAX - PUBLIC UTILITY TAX -- MUNICIPALLY OWNED REFUSE OR SOLID WASTE COLLECTION BUSINESSES.A municipally owned refuse or solid waste collection business is subject to tax under the service and other classification of the business and occupation (B&O) tax.

REFUSE OR SOLID WASTE COLLECTION BUSINESS -- POLITICAL SUBDIVISIONS -- COMPENSATION FOR SERVICES.Amounts received by a municipal corporation from a county health department are deductible under RCW 82.04.4291.

USE TAX BUSINESS AND OCCUPATION TAX PUBLIC UTILITY TAX EXEMPTION COST OF CAPITAL FACILITIES.The exemption to the public utility tax, provided by the former RCW 82.16.417, does not extend to amounts paid to a municipal corporations water department from a water district, organized under ch. 57.04 RCW, when the municipal corporations water department uses a portion of those payments to pay for its capital facilities.

PUBLIC UTILITY TAX -- DEDUCTIONS -- IRRIGATION.When an irrigation district supplies potable water and some of the water is segregated and separately supplied solely for the nourishing of plant life, as opposed to water supplied for domestic, municipal, or industrial uses, charges for such separately supplied water are subject to the deduction for water distributed through an "irrigation system, for irrigation purposes".

PUBLIC UTILITY TAX DEDUCTIONS IRRIGATION.So long as an irrigation or water district or a municipal water department supplies potable water and it segregates and separately supplies some of the water solely for nourishing plant life, as opposed to water supplied for domestic, municipal, or industrial uses, charges for such separately supplied water qualify for the deduction for water distributed through an irrigation system, for irrigation purposes.

PUBLIC UTILITY TAX AND BUSINESS AND OCCUPATION TAX DEDUCTIONS AMOUNTS RECEIVED IN LIEU OF EMINENT DOMAIN.When a public utility receives funds from the Department of Transportation to reimburse it for the costs of moving public utility facilities necessitated by the Department of Transportations construction, improvement, or demolition of a state highway, the amount of the payment is in lieu of eminent domain proceedings.As such, the amounts received are not subject to either business and occupation or public utility taxes, provided the amounts received do not include the costs of any improv

PUBLIC UTILITY TAX AND BUSINESS AND OCCUPATION TAX DEDUCTIONS.The deductions from the measure of tax listed in Rule 179(10) apply to both the public utility tax and the business and occupation tax, while the deductions listed in Rule 179(9) apply only to the public utility tax.

PUBLIC UTILITY TAXDETENTION OR DEMURRAGE CHARGESINCIDENTAL SERVICES.Detention or demurrage charges have a double purpose; one is to secure compensation for use of containers beyond the expected transportation period and the other is to provide a penalty or deterrent against undue detention.Rather than being a rental charge, a demurrage or detention charge is an incidental part of the transportation service.

B&O TAX DEDUCTIONS SERVICE RENDERED AMOUNTS RECEIVED FROM ANOTHER POLITICAL SUBDIVISION.A Washington municipality was not allowed a deduction under RCW 82.04.4291 for amounts received for sewerage services rendered to a political subdivision of the State of Idaho.

B&O TAX GROSS INCOME SEWERAGE SERVICES PROPORTIONATE SHARE OF MAINTENANCE AND OPERATING EXPENSES.Where a city's sewerage disposal service contract with another municipality required the other municipality to a pay a percentage of operating and maintenance costs in addition to sewerage disposal fees, the additional proportionate share of costs was part of the city's gross income.

RETAIL SALES TAX AND USE TAX -- WATERCRAFT EXEMPTIONS -- DELIVERING BUNKER FUEL -- TRANSPORTING THEREIN OR THEREWITH -- INTERSTATE OR FOREIGN COMMERCE.The fact that ocean-going vessels to which Taxpayers watercraft deliver bunker fuel cannot consume the fuel until they are in international waters, does not bring Taxpayers instate transportation of the bunker fuel within the exemptions in RCW 82.08.0262 and RCW 82.12.0254.The bunker fuel is no longer an item of commerce once Taxpayer unloads it onto the other vessels in Washington waters, thus Taxpayers transportation is not a leg of a conti

PUBLIC UTILITY TAX ON FUEL TRANSFER FEES CHARGED TO CUSTOMERS - Rule 195 explains the circumstances under which taxes may be deducted from the gross amount reported as the measure of tax under PUT, and lists examples of specific deductible and nondeductible taxes.The rule expressly provides: License and regulatory fees are not deductible.

PUBLIC UTILITY TAX -- DEDUCTIONS -- EXPORTS -- COMMODITIES -- FORWARD -- FOREIGN DESTINATIONS.Revenue from transportation of bunker fuel, for consumption, to ship side on Washington tidewater or navigable tributaries, is not deductible under RCW 82.16.050(8).There is no forwarding of commodities to interstate or foreign destinations required by the statute.

RETAIL SALES TAX AND USE TAX -- WATERCRAFT EXEMPTIONS -- DELIVERING BUNKER FUEL -- TRANSPORTING THEREIN OR THEREWITH -- INTERSTATE OR FOREIGN COMMERCE.Delivering marine bunker fuel, for consumption, to other vessels carrying and moving cargo in interstate or foreign commerce, does not constitute transporting the cargo that is aboard the other vessels.It is not a use that qualifies for the exemptions in RCW 82.08.0262 and RCW 82.12.0254.

WATER DISTRIBUTION BUSINESS -- INCIDENTAL SALES -- REGULATED UTILITIES.Taxpayer primarily engaged in business as a manufacturer but making incidental sales of water from a well which it owns and operates is taxable under public utility tax as a Water Distribution Business, even though it sells only a relatively small amount of water to a single buyer and is not a "public utility" in the sense that it is subject to state regulatory authority.

PUBLIC UTILITY TAX -- EXEMPTION -- MOTOR TRANSPORTATION -- EXPORTS -- INTERVENING TRANSPORTATION DEFINED. No exemption allowed from urban transportation tax for export logs hauled between points in the same city.Exemption allowed from motor transportation tax for hauling export logs where no intervening transportation occurs between point of origin and export yard.Transporting logs between sorting area and pier in export yard is not "intervening transportation" as that term is used in RCW 82.12.050(8) and Rule 179.

B&O AND PUBLIC UTILITY TAX -- EXEMPTION -- CHARGES FOR RETIREMENT OF BONDS ISSUED FOR CAPITAL PURPOSES -- REQUIREMENT FOR EXEMPTION. Income from charges to customers for bond retirement on capital projects is excludable under RCW 82.04.417, even if the utility designates the income as a "service charge," if the revenue is separately accounted for, used exclusively for the bond retirement and there is "special authority" for its collection.

B&O AND PUBLIC UTILITY TAX EXEMPTION -- CHARGES FOR RETIREMENT OF BONDS ISSUED FOR CAPITAL PURPOSES -- REQUIREMENT FOR EXEMPTION -- ORDINANCES ESTABLISHING BOND FUND. City ordinances establishing bond funds can constitute the "special authority" for the collection of the bond funds to meet the Department of Revenue's requirement for exemption under RCW 82.04.417.

B&O AND PUBLIC UTILITY TAX -- EXEMPTION -- CHARGES FOR CAPITAL COSTS. Revenue received as a result of monthly payments for services rendered is taxable gross income even if used wholly or in part for capital purposes; the revenue received for billing a customer for constructing a distribution system to his property is not taxable gross income. (King County Water District 68 v. Tax Commission, Kennewick v. State and Seattle v. State cited.)

PUBLIC UTILITY TAX REPEAL OF EXEMPTION -- SERVICE CHARGES -- CONTRIBUTIONS IN AID --CAPITAL FACILITIES -- BONDED INDEBTEDNESS.The repeal of RCW 82.04.417 applies to all revenues received by a utility for engaging in the activity ofproviding electrical energy after the effective date of the repeal.Revenues which may have been formerlydeductible from utilitys gross income because they were received by the utility for reduction of bonded indebtedness are no longer deductible.Laws of 1993, ch. 25, 801, distinguishing Det. No. 87-63, 2 WTD 285 (1986); Det. No. 89-41, 8WTD 195 (1989) and Det.

PUBLIC UTILITY TAX REPEAL OF EXEMPTION -- SERVICE CHARGES -- CONTRIBUTIONS IN AID --CAPITAL FACILITIES -- RETROACTIVITY.Repealing statutes are presumed to operate retroactively and terminate all rights dependent upon the repealed statute.Lau v. Nelson, 89 Wn.2d 772, 575 P.2s 719 (1978)

PUBLIC UTILITY TAX -- REPEAL OF EXEMPTION -- SERVICE CHARGES -- CONTRIBUTIONS IN AID --CAPITAL FACILITIES -- BONDED INDEBTEDNESS. Repeal of RCW 82.04.417 withdrew the authority for Det. No. 80-451, 98 WTD 195 (1985).

PUBLIC UTILITY TAX -- SERVICE CHARGES -- CAPITAL FACILITIES -- BONDED INDEBTEDNESS. Amounts attributable to capital construction and reduction of bonded indebtedness contained in services charges are not deductible from gross receipts of utility districts, although amounts received by the utility for extending new service to customers or additional service to existing customers at different locations are deductible. Citing Kennewick v. State, 67 Wn.2d 589, 409 P.2d 128 (1965).

RCW 82.16.047, RCW 82.04.355: PUBLIC UTILITY TAX B&O TAX -- EXEMPTIONS RIDE SHARING SPECIAL TRANSPORTATION NEEDS.Income from operating a transit agencys paratransit service is not exempt from PUT or B&O tax, because the exemption for companies transporting persons with special transportation needs applies only to public social service agencies or private nonprofit transporters.

RCW 82.16.050: PUBLIC UTILITY TAX DEDUCTIONS JOINTLY PROVIDED SERVICES.A taxpayer can not deduct from its gross income amounts paid to another service provider for jointly provided services when the taxpayer reports no income from the jointly provided services.

The taxpayer in this determination was a transit authority that provided paratransit services. The determination concluded that a transit authority does not qualify as public social service agency and, therefore, could not claim the PUT exemption under RCW 82.16.047. This conclusion is in conflict with the findings in Det. No. 95-183E, 15 WTD 162 (1996) and Det. No. 97-104R, 17 WTD 59 (1998) and has caused taxpayers confusion. For this reason, the Department withdraws it.

ETA 2006: SERVICE B&O TAX CARRIAGE BY AIR OF INSPECTORS OBSERVING AERIAL SPRAYING OF INSECTICIDE.Gross income from the carriage of federal inspectors in helicopters or other aircraft to observe the aerial spraying of insecticide to eradicate the Asian Gypsy Moth is subject to service B&O tax because the flights, like examples given in ETA 2006, originate and end in the same location.

LEGISLATIVE INTENT.Legislative intent of RCW 82.04.310(2) was to treat power marketers the same as power and light businesses, i.e., to relive them of paying either public utility tax or B&O tax on sales of electricity for resale within or without the state. The intent was not to eliminate the B&O tax on businesses that merely trade in electricity contracts.

ELECTRICITY CONTRACTS.A person trading in electricity contracts is deemed to be engaged in a financial business and is taxable on the gain realized from the trading activity.

ELECTRICITY CONTRACTS -- FUTURES CONTRACTS-- FORWARD CONTRACTS. A contract for the sale of electricity is not a forward contract for the sale of the underlying commodity for purposes of RCW 82.04.310(2) where the parties do not anticipate physical delivery of electricity.

ELECTRICITY CONTRACTS -- FUTURES CONTRACTS-- FORWARD CONTRACTS. A forward contract for the sale of electricity is not a sale of the underlying commodity for purposes of RCW 82.04.310(2), if physical delivery does not in fact occur.

RETAIL SALES TAX -- EXEMPTION MACHINERY AND EQUIPMENT -- ENERGY GENERATION.A public utility districts purchases of machinery and equipment incorporated into an interconnection facility were not exempt from retail sales tax under RCW 82.08.02567 where the interconnection facility was owned and operated by the PUD.

PUBLIC UTILITY TAX AIRFREIGHT.Income derived from the carriage of passengers or mail in air commerce (federally regulated airspace, whether an interstate or intrastate flight), is exempt from public utility tax. Income derived from the interstate carriage of passengers, mail, or freight is exempt from public utility tax.Income derived from providing purely intrastate freight hauling services is subject to the public utility tax, even if the intrastate haul occurs in federally regulated airspace.

USE TAX AIRCRAFT PURCHASES OF AIRCRAFT AND REPAIRS.Exemption from the use tax requires that the taxpayer document that the aircraft was used primarily in conducting interstate or foreign commerce by transporting property or persons.

PUBLIC UTILITY TAX LIGHT AND POWER BUSINESS GROSS INCOME OPERATIONS INCIDENTAL THERETO.Where a taxpayers business model required that it routinely over-purchase electricity transmission capacity from a supplier, income received from the sale of excess electricity transmission capacity was derived from an operation incidental to Taxpayers business of purchasing, transmitting, and distributing electricity to customers. Therefore, it was taxable under the light and power rate of the public utility tax.

RCW 82.16.050(9):PUBLIC UTILITY TAX DEDUCTION ALLOWED IN COMPUTING THE TAX FOR AMOUNTS DERIVED FROM THE PRODUCTION, SALE, OR TRANSFER OF ELECTRICAL ENERGY FOR RESALE PROOF REQUIRED.RCW 82.16.050(9) authorizes a deduction in computing the public utility tax for amounts derived from the production, sale, or transfer of electrical energy for resale within or outside the state or for consumption outside the states.To qualify for the deduction, the taxpayer is required to show that the gross income in question was (1) derived from the production, sale, or transfer of electrical energy, and (2) t

RCW 82.16.010(12):PUBLIC UTILITY TAX DEFINITION OF GROSS INCOME AMOUNTS DERIVED FROM OPERATIONS INCIDENTAL TO THE PERFORMANCE OF LIGHT AND POWER BUSINESS OPERATIONS SALE OF EXCESS TRANSMISSION CAPACITY.A light and power business is subject to the public utility tax on its gross income derived from the performance of its light and power business operations, including operations incidental thereto.Maintaining or having access to transmission capacity is incidental to the operations of a light and power business, and amounts received from selling excess transmission capacity qualify as gross

RCW 82.16.010(12):PUBLIC UTILITY TAX DEFINITION OF GROSS INCOME AMOUNTS DERIVED FROM OPERATIONS INCIDENTAL TO THE PERFORMANCE OF LIGHT AND POWER BUSINESS OPERATIONS SALE OF EXCESS OPERATING CAPACITY RESERVE.A light and power business is subject to the public utility tax on its gross income derived from the performance of its light and power business operations, including operations incidental thereto.Maintaining or having access to excess operating capacity is incidental to the operations of a light and power business, and amounts received from selling excess operating capacity qualify as g

RCW 82.16.010:PUBLIC UTILITY TAX WHOLESALE SALES OF ELECTRICITY NOT EXEMPT.Under the Washington public utility tax, the gross income of a light and power business is made up of those amounts derived directly from, or incidental to, the business of operating a plant or system for the generation, production or distribution of electrical energy for hire or sale and/or for the wheeling of electricity for others.The statute does not distinguish between wholesale and retail business operations, and Rule 179(3)(e) does not support the assertion that only income derived from retail business operati

RCW 82.16.010(12):PUBLIC UTILITY TAX DEFINITION OF GROSS INCOME AMOUNTS DERIVED FROM OPERATIONS INCIDENTAL TO THE PERFORMANCE OF LIGHT AND POWER BUSINESS OPERATIONS SALE OF SCHEDULING SERVICES.A light and power business is subject to the public utility tax on its gross income derived from the performance of its light and power business operations, including operations incidental thereto.Scheduling services are incidental to the operations of a light and power business and amounts received from providing scheduling services qualify as gross income subject to the public utility tax.

RCW 82.12.035: USE TAX – CREDIT FOR RETAIL SALES TAX PAID TO ANOTHER STATE. If the Texas retail sales tax was legally imposed and paid with respect to cranes that were delivered in Texas, the taxpayer was entitled to a credit under RCW 82.12.035.

RCW 82.04.080: GROSS INCOME OF THE BUSINESS – FEES – NONPROFIT – WATER ASSOCIATION. Up-front fees paid by new members to a nonprofit water association that grant those new members voting rights and other membership rights, including the right to hook-up and receive water, constitute “gross income of the business” and are taxable to the nonprofit water association at the service and other activities business and occupation (“B&O”) tax.

RCW 82.16.020: PUBLIC UTILITY TAX – CONTRACT MAIL TRANSPORTATION SERVICE – AGENCY OR INSTRUMENTALITY OF UNITED STATES – DIRECT TAXATION – TAX IMMUNITY. Under the Supremacy Clause of the United States Constitution, U.S. Const., Art. VI, cl. 2, a state may not directly tax the United States or any agency or instrumentality so closely connected to the United States that the two cannot realistically be viewed as separate entities.

RCW 82.16.050(8): PUBLIC UTILITY TAX – CONTRACT MAIL TRANSPORTATION SERVICE – DEDUCTIONS – EXPORTS – COMMODITIES – FOREIGN ORIGINS OR DESTINATIONS. RCW 82.16.050(8) allows a deduction from gross income revenue from the transportation of commodities from points of origin in this state to a final destination outside this state, or from points of origin outside this state to a final destination in this state. Revenue from contract mail transportation services that begin and end in Washington is not deductible under RCW 82.16.050(8).

PUBLIC UTILITY TAX -- ELECTRICAL ENERGY -- LAST DISTRIBUTION OF -- IRRIGATION DISTRICT.The sale of electrical energy by an irrigation district, the hydroelectric power generation facilities of which are operated by an agent hydroelectric authority, to Washington cities for distribution to consumers, does not result in gross income subject to the public utility tax.Such tax is imposed only on the last distribution of electrical energy within the state.

PUBLIC UTILITY TAX -- LIGHT AND POWER BUSINESS -- LAST DISTRIBUTION OF ELECTRICAL ENERGY -- RESIDENTIAL EXCHANGE OF POWER.Amounts received by a utility from the Bonneville Power Administration under the terms of an exchange agreement authorized by 16 U.S.C. 839 (Pacific Northwest Electrical Power Planning and Conservation Act) are not subject to tax.F.I.D.

RCW 82.16.010(11) -- PUBLIC UTILITY TAX -- EXCLUSION -- STORAGE -- PUBLIC SERVICE BUSINESS.Charges for storage of a customer's property are not subject to the public utility tax where the business was not defined by RCW 82.16.010 as either subjected to state control, having the powers of eminent domain, or declared to be of a public service nature.Shurgard Mini-Storage v. Department of Rev., 40 Wn.App. 721 (1985) followed.

B&O TAX AND PUBLIC UTILITY TAX -- EXEMPTION -- CHARGES FOR CAPITAL COSTS.Revenue received as a result of monthly payments for services rendered is taxable gross income even if used wholly or in part for capital purposes; the revenue received for billing a customer for the cost of electric distribution system improvements which is not related to the customer's general obligation to pay the monthly service charge is not taxable income to the utility. Seattle v. State, 12 Wn. App. 91 (1974) followed.

PUBLIC UTILITY TAX -- DISTRIBUTION OF ELECTRICITY -- INCIDENTAL SALES -- REGULATED BUSINESSES.Taxpayer primarily engaged in business as a manufacturer which makes sales of electricity through a substation which it owns and operates is taxable under public utility tax as a light and power business, even though it sells only a relatively small amount of [power] to a single buyer and is not a "public utility" in the sense that it either holds itself out to the public to be in that business or is subject to state regulatory authority.Ruling prospective in nature.

PUBLIC UTILITY TAX -- POOL PURCHASES -- ELECTRICITY.To qualify as a pool purchase all requirements of Rule 202 must be met, two of which are that each party to the agreement needs to have agreed to accept a specific portion of the shipment, and paid no more than a proportionate amount for that share.

PUBLIC UTILITY TAX -- EXEMPTION -- SERVICE CHARGES -- CONTRIBUTIONS IN AID -- CAPITAL FACILITIES -- BONDED INDEBTEDNESS. P.U.D.s satisfy the first of the threefold criteria through publicly adopted rate schedules which set and identify amounts or percentages levied for capital facilities/purposes expenditure

PUBLIC UTILITY TAX -- EXEMPTION -- SERVICE CHARGES -- CONTRIBUTIONS IN AID -- CAPITAL FACILITIES -- BONDED INDEBTEDNESS.Gross receipts of utility districts through utility service rate charges include taxable "service charges" as well as tax exempt amounts attributable to capital construction and reduction of bonded indebtedness.Such amounts are all derived from the sale of utility services (power, water, etc.).

PUBLIC UTILITY TAX -- EXEMPTION -- SERVICE CHARGES -- CONTRIBUTIONS IN AID -- CAPITAL FACILITIES -- BONDED INDEBTEDNESS.Entitlement to exemption from public utility tax of amounts received for capital construction purposes is determined by a threefold test: A. Pre-receipt identification and approval of billing amounts or percentages levied for capital facilities or capital purposes; B. Segregation of capital facilities or capital purpose levies upon receipt; and C. Dedication and ultimate capital facility or capital purpose expenditure of such levies following receipt.

PUBLIC UTILITY TAX -- MOTOR TRANSPORTATION -- PLACE OF SERVICE -- INTERSTATE COMMERCE INTERSTATE BILL OF LADING -- ABSENCE THEREOF.When a motor carrier is paid for hauling which takes place entirely outside of Washington or for hauling across Washington's boundaries, it is not taxable.When it is paid for hauling entirely within Washington absent an interstate bill of lading, it is subject to Motor Transportation (or Urban Transportation) public utility tax.It may, however, deduct amounts paid to other motor carriers subject to tax.

ESTOPPEL -- PUBLIC UTILITY AND B&O TAX -- "CONTRIBUTIONS IN AID OF CONSTRUCTION" -- PRIVATE FOR PROFIT WATER COMPANY.Estoppel denied because an industry organization-not the Department-failed to advise its members that private for profit water companies would not qualify for the "contributions in aid of construction" deduction.Department employee had not given erroneous advice to the organization.Reliance was unreasonable because of the clear language of the statute and rule.