Washington State Sales Tax Exemption and Long Range Model 3...

[acarney]

Just seeing if there has been any follow up on this. Do the Tesla Model 3 Long Range count for the sales tax exemption? I know it mentions $45k or under for a selling price, but I also know there used to be wording on "base model" had to be within that price. So does the Long Range qualify since on the MVPA the LR AWD is shown as an upgrade or addon cost?

Anyone buy a Long Range car in the last few months get the tax exemption?

 

[DSolie]

As long as the BASE model price isn't more than $45k, you should be okay
RCW 82.08.809: Exemptions—Vehicles using clean alternative fuels and electric vehicles, exceptions—Quarterly transfers.

You can give them a call though and ask, from what I hear they are pretty quick with answers. 360-705-6705

 

[acarney]

As long as the BASE model price isn't more than $45k, you should be okay
RCW 82.08.809: Exemptions—Vehicles using clean alternative fuels and electric vehicles, exceptions—Quarterly transfers.

You can give them a call though and ask, from what I hear they are pretty quick with answers. 360-705-6705

I'm curious if anyone has actually experienced that. I called them when this went live back in late July/early August of last year and sat on the phone with someone for about 45 minutes while they read over the law and the information they had been given and they couldn't come up with a clear answer but erred on the side of "no, the out the door cost must be $45k or less." It's why I got my SR+ instead of a Long Range... but I'm debating selling the SR+ and upgrading to the LR if the tax exemption has been more researched and applies to the LR...

 

[PNWLeccy]

@acarney I remember discussing this with you last year when we were trying to figure this out

I found this list of eligible vehicles: https://data.wa.gov/Transportation/Vehicle-Models-Eligible-for-the-Washington-State-T/aug9-4a7g
It's interesting because they include all Tesla models but if you look at the Notes section that lays out criteria for inclusion on the list:

5. AND sales price plus trade-in value that is within the amounts allowed by the 2019 House Bill 2042 passed legislation​

Unfortunately, I still find this as confusing as it was a year ago!

 

[acarney]

@acarney I remember discussing this with you last year when we were trying to figure this out

I found this list of eligible vehicles: https://data.wa.gov/Transportation/Vehicle-Models-Eligible-for-the-Washington-State-T/aug9-4a7g
It's interesting because they include all Tesla models but if you look at the Notes section that lays out criteria for inclusion on the list:

5. AND sales price plus trade-in value that is within the amounts allowed by the 2019 House Bill 2042 passed legislation​

Unfortunately, I still find this as confusing as it was a year ago!

I didn't see that note, but I did notice that they don't break down sub models, and instead just "Model 3"... well Model 3 can go up to like $56k....

 

[Hebert]

Here is the text from the bill. The way I read this is the sales price must be $45k or less including trade in value for new vehicles to qualify.

Alternative Fuel Vehicle Retail Sales and Use Tax Exemption . The alternative fuel vehicle retail sales and use tax exemption is reinstated using the same vehicle qualification criteria in place between July 1, 2016, and May 31, 2018, except that the qualification requirement related to price for new vehicles is changed to only permit vehicles with a sales price (including any trade-in value) or fair market value of $45,000 or less, and used vehicles with a sales price (including any trade in value) or fair market of $30,000...

 

[im.thatoneguy]

Sounds very much like full sale price.

I think Washington took umbrage with the way Tesla was defining vehicle base prices last time around.

All model 3s were sold as "$35,000 base price + $9,000 Long Range Battery accessory + $5,000 AWD accessory + $5,000 Performance Package + $5,000 Premium Package" So for the purposes of "Base Price" every single Model 3 regardless of trim was a "$35k" Model 3.

I still take umbrage with Washington trying to charge extra sales Tax for a battery which isn't a luxury item though. Tesla's pricing breakdown was far more fair. I think it's fair for someone who buys the AWD or Performance package to pay more in RTA taxes, but I don't think it's fair for someone who pays $10,000 for a battery vs a $100 for a larger gas tank should pay taxes on $9k more car.

If you buy a $50k Model 3 you're paying $5k in taxes even though a $35k BMW M3 is comparable in luxury and features. A $35k Bolt is equivalent in luxury to a $17k Chevy Sonic. They should have just exempted $20k in "EV Equipment costs" and let you spend as much as you wanted.

 

[acarney]

Sounds very much like full sale price.

I think Washington took umbrage with the way Tesla was defining vehicle base prices last time around.

All model 3s were sold as "$35,000 base price + $9,000 Long Range Battery accessory + $5,000 AWD accessory + $5,000 Performance Package + $5,000 Premium Package" So for the purposes of "Base Price" every single Model 3 regardless of trim was a "$35k" Model 3.

I still take umbrage with Washington trying to charge extra sales Tax for a battery which isn't a luxury item though. Tesla's pricing breakdown was far more fair. I think it's fair for someone who buys the AWD or Performance package to pay more in RTA taxes, but I don't think it's fair for someone who pays $10,000 for a battery vs a $100 for a larger gas tank should pay taxes on $9k more car.

If you buy a $50k Model 3 you're paying $5k in taxes even though a $35k BMW M3 is comparable in luxury and features. A $35k Bolt is equivalent in luxury to a $17k Chevy Sonic. They should have just exempted $20k in "EV Equipment costs" and let you spend as much as you wanted.

I wish Tesla had the option to sell the 75kWh car and then bill your credit card the difference between the two ^_^

I wouldn’t put any down payment on the car, get my tax exemption, and then just pay off the credit card as my down payment

 

[im.thatoneguy]

I wish Tesla had the option to sell the 75kWh car and then bill your credit

If Tesla wanted to be really tricky they could sell a $44,999 model 3 to qualify and then offer software upgrades which make it enjoyable. Eg lock it into 0-60 in 10.5seconds, No stereo, No AC, power windows that you have to tap for every inch... Just like mega sand bag the car. 100mi range.

Then sell you an upgrade package after delivery to make your car not suck. The Y could be called the Model Shid-Y

 

[tri100]

So having just ordered a Tesla Model 3; I also am curious about this...ok, so here's how it works as best as I can tell
#1 - 82.12.809 establishes that:

------------------
(4)(a) For vehicles identified in subsection (1)(a) of this section purchased on or after July 1, 2016, and before the expiration of the exemption as described in RCW 82.08.809(6), or for leased vehicles identified in subsection (1)(a) of this section for which the lease agreement was signed on or after July 1, 2016, and before the expiration of the exemption as described in RCW 82.08.809(6), a vehicle is not exempt from use tax as described under subsection (1)(b) of this section if, at the time the tax is imposed for purchased vehicles or at the inception of the lease for leased vehicles, the lowest manufacturer's suggested retail price, as determined in rule by the department of licensing pursuant to chapter 34.05 RCW, for the base model is more than forty-two thousand five hundred dollars.
----------------------

So the question is what defines the lowest manufacturer's suggested retail price of a base model? Well apparently according to the law its 'determined by a rule by the department of licensing'. Well what the heck is that...Well I managed to find this:

#3 - WSR 16-18-004 - This is the Washington State Registration codes for various stuff for proposed rules...way down in this:

------------------------------
Original Notice.

Preproposal statement of inquiry was filed as WSR 16- 08-049.

Title of Rule and Other Identifying Information: Retail sales and use tax exemption criteria for clean alternative fuel vehicles.

...

Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: 2ESHB 2778, enacted by the 2016 legislature, requires that the department of licensing adopt a rule to determine the lowest manufacturer's retail price for base model clean alternative fuel vehicles for purposes of retail and use tax exemption criteria set by statute. This rule making will make an emergency rule, WAC 308-04-030, permanent.

Reasons Supporting Proposal: Required by recent legislation.

Statutory Authority for Adoption: RCW 82.08.809 and 82.12.809.

Statute Being Implemented: RCW 82.08.809 and 82.12.809.

Rule is not necessitated by federal law, federal or state court decision.
---------------
Ah Ha! So there was an emergency rule is defined in WAC 308-04-030! Note: WSR 16-08-049 just says they have to go make a rule...

So if we look there:

#3 - https://app.leg.wa.gov/Wac/registerfiling.aspx?cite=308-04-030 - here is the emergency rule, the proposed rule, and the Permeant rule. If we examine the Permeant rule filed as of 10/18/2016 and effective Nov 18, 2016. This states:

NEW SECTION
WAC 308-04-030 Retail sales and use tax exemption criteria for clean alternative fuel vehicles.
For the purposes of RCW 82.08.809 and 82.12.809:
(1) The lowest manufacturer's retail price for a base model vehicle is the one provided by a vendor selected by the department;
(2) The department publishes and periodically updates a list of all vehicle models qualifying for the sales and use tax exemptions under those sections; and
(3) The list of qualifying vehicle models is available on the department's web site.
As used in this section, "base model" means the least expensive and least optioned model of a qualifying vehicle identified in RCW 82.08.809 (1)(a) and 82.12.809 (1)(a).

Therefore, what is a 'base model' that has to be less than 42k? Per rule WAC308-04-030; a 'base model' is identified as the least expensive and least options model of a qualifying vehicle. THEREFORE as of today 10/24/2020; a Tesla Model 3 with the least optioned modem has a base model cost of: $37,990 which is less than 42.5k!

Thus a Model 3 should be eligible under the laws as defined by Washington State and all associated released Permanent Rules.

If you are successful please done 10% of your recovered funds to me! Or at a minimum let me know if you are, so when I get my Tesla I can follow your lead.

 

[tri100]

Oh an P.S. this conflicts with 82.12.9999 which says its not eligible. So ya, there's that. Not sure which takes precedence. Probably the one we don't like

 

[tri100]

Ah darn, nevermind ignore everything I said. The .809 is noted as expired in the rule. so .9999 is valid currently; thus the model 3 is not eligible. ..darn...sorry for misleading folks...laws are hard to read

 

[acarney]

Ah darn, nevermind ignore everything I said. The .809 is noted as expired in the rule. so .9999 is valid currently; thus the model 3 is not eligible. ..darn...sorry for misleading folks...laws are hard to read

I believe the Model 3 SR+ is still eligible for the WA EV Sales tax exemption though... have you ordered a car or are you about to?

 

[VandalSibs]

I believe the Model 3 SR+ is still eligible for the WA EV Sales tax exemption though... have you ordered a car or are you about to?

It is - I got the exemption on all of my sales documents. The Sales Tax is automatically adjusted lower. Paid less than $1,500 in sales tax for my SR+ last November.

 

[jbakes09d]

I was hoping that the 2021 refresh would motivate Tesla to discount the 2020s a little more, but it doesn't seem to have. I told the Tesla Advisor I have been in contact with that if they found a 2020 LR AWD that they'd sell under the $45k price ceiling I'd be very motivated to take it off their hands, but I was basically told that I shouldn't hold my breath.

I really wish that Tesla would sell a WA special software limited LR AWD, maybe call it 'mid-range AWD', that could be unlocked to LR after puchase.

 

[acarney]

I was hoping that the 2021 refresh would motivate Tesla to discount the 2020s a little more, but it doesn't seem to have. I told the Tesla Advisor I have been in contact with that if they found a 2020 LR AWD that they'd sell under the $45k price ceiling I'd be very motivated to take it off their hands, but I was basically told that I shouldn't hold my breath.

I really wish that Tesla would sell a WA special software limited LR AWD, maybe call it 'mid-range AWD', that could be unlocked to LR after puchase.

You would have to find a white exterior black interior that was discounted almost $3,200. The best bet would be a demo unit that’s been sitting around and has 4,000 to 5,000 miles on it, they usually discount about $0.80 to $1 a mile. However, you’ll probably have a harder time finding a white paint and non-performance version as a demo...

 

[jbakes09d]

You would have to find a white exterior black interior that was discounted almost $3,200.

Despite wanting to get into a Model 3, I don’t need one. I’ve set the expectation of what would move me to purchase one with the Advisor I stay in touch with and maybe they’ll call me if something comes up.

There is a White on Black LR AWD demo that is getting very close to the right price, but I know Tesla is hoping to clear out the 2020s for as close to MSRP is as possible.

 

[acarney]

Despite wanting to get into a Model 3, I don’t need one. I’ve set the expectation of what would move me to purchase one with the Advisor I stay in touch with and maybe they’ll call me if something comes up.

There is a White on Black LR AWD demo that is getting very close to the right price, but I know Tesla is hoping to clear out the 2020s for as close to MSRP is as possible.

Is there one seriously discount near $3k?!

 

[Moonbeast]

Does Tesla collect the sales tax in Washington State?

 

[acarney]

Does Tesla collect the sales tax in Washington State?

They sure do! I also sent you a private message on this site with some other tidbits in it. Feel free to ask any more questions, I'm over in Richland