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Q: Taxation issues regarding buying a used car in Seattle, Washington ( Answered 5 out of 5 stars,   0 Comments )
Subject: Taxation issues regarding buying a used car in Seattle, Washington
Category: Sports and Recreation > Automotive
Asked by: pugwonk-ga
List Price: $10.00
Posted: 31 Oct 2006 10:52 PST
Expires: 30 Nov 2006 10:52 PST
Question ID: 778822
I am a British national resident in Seattle, Washington State, USA. I
want to buy a second-hand car but I'm unsure of how the sales tax

1. Am I charged sales tax on second-hand vehicles, despite the fact
that someone else has already paid sales tax on the original purchase

If this is the case...

2. does it make a difference whether I buy from a dealer or an individual?

3. Does it make a difference if I buy it outside of Seattle, where I
believe the sales tax is 6.5 instead of 8.8? Will I be forced to pay
the difference when I bring the car back to Seattle?

Any help much appreciated - I'm finding it all rather confusing.

Subject: Re: Taxation issues regarding buying a used car in Seattle, Washington
Answered By: omnivorous-ga on 31 Oct 2006 13:10 PST
Rated:5 out of 5 stars
Pugwonk ?

A retail sales tax is paid on every transaction, unless you?re a
dealer buying a car for resale or lease.  It applies to all cars (and
boats and airplanes), even if a sales tax was paid by the previous

Retail sales taxes are defined for state of WA on this Department of Revenue page:

Washington Department of Revenue
?Retail Sales Tax? (2006)

These taxes are collected and paid by dealers.  However, if you?re
making a purchase from another individual, you?re obligated to pay the
tax as a ?use tax."

The base state rate is 6.5%, with additional local taxes in King
County (Seattle) and most of the surrounding counties.  The Seattle
rate is 8.8%; the rate for Everett (Snohomish County) is 8.6%; and for
Tacoma it is 8.8%.  According to the Department of Revenue, ?The use
tax is applied at the same rate as sales tax at the purchaser?s
address, and is paid by the buyer when the car title is transferred.? 
IMPORTANT: the state also tacks on an additional 0.3% for any motor
vehicle use tax and if you use a credit card, there?s an additional
charge for that as well.

You can look up the local taxes here:
Washington Department of Revenue
?Local Sales and Use Tax Rates? (effective Oct. 1, 2006)

The purchase invoice is used, unless it differs by more than $2,000
from the average fair market value.

?Use Tax Facts for Vehicle Transactions?

The actual payment is made NOT to the Department of Revenue but to the
Department of Licensing:

Washington Department of Licensing
?Use Tax?
There are several ways that a person can avoid the use taxes,
including owning a vehicle for more than 90 days before moving into
the state; by reducing the amount of tax paid via a trade-in; or even
by leasing.  They are outlined here:

Reduction of tax by use of a trade-in:
?Use Tax?

Google search strategy:
?used cars? ?sales tax? WA

This process can still be confusing, even for those of us who are
residents, so don?t hesitate to ask for clarifications, if necessary.

Best regards,

Mukilteo, WA
pugwonk-ga rated this answer:5 out of 5 stars
Superb, many thanks. Exactly what I was after.

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