DOR Listening Sessions on New Sales Tax Law

by Mike Nelson 

The Washington State Department of Revenue (DOR) has announced it will hold listening sessions in late July as they look to implement recent changes to Washington Sales Tax Law as passed in Engrossed Substitute Senate Bill (ESSB) 5814 by the legislature.

There are many issues within this law that could potentially impact the accounting profession. This law clearly made live presentations, which would include CPE, subject to the sales and use tax, but there are others which are more ambiguous and concerning.

One is the addition of sales tax to temporary staffing. The concern for some in the accounting profession is whether bookkeeping, fractional CFO services, etc., are included in this statute. The language passed in ESSB 5814 does not define any of the terms, meaning there is great uncertainty as to which services from the accounting profession may be affected.

The other issue which could have the largest impact is the change to Digitally Automated Services (DAS). The law removed an exemption for primarily human effort. The concern is that if a CPA uses technology with functionality to do more than merely transmit documents to a client the service could be subject to sales tax as a DAS. We have been requesting guidance from the DOR on this issue as it would severely change the accounting profession’s practices in Washington if services were deemed to be subject to sales tax. As of July 9, the DOR “Services newly subject to retail sales tax” webpage has a “Issues we have identified” section that includes this question: “Do traditional professional services such as legal, accounting, and lobbying become subject to retail sales tax as DAS if electronic tools are used in performing the services?” We will continue pressuring DOR to issue guidance on this as soon as possible. 

Here is the link to check the schedule and register to attend one or more of the DOR’s listening sessions on any of the above topics. If you are unable to attend and would like to submit written feedback to them through this process, you can fill out a DOR survey online here.  

Related Resources
Tell DOR Accounting Services Should Not Be Subject to Digital Automated Services Sales Tax 
Major Tax Changes Coming to Washington State