The Washington Department of Revenue has provided guidance on legislation addressing the sales and use tax and business and occupation (B&O) taxation of digital products. H.B. 2620 provides exemptions for digital products. If a business purchases digital goods solely for a business purpose, then the purchase is exempt from sales tax. Digital products, including digital goods, digital automated services, or digital codes purchases to be given away free of charge to the general public are also exempt. The legislation also clarifies the definition of data processing services to mean: primarily automated services provided to a business or other organization where the primary object of the service is the systematic performance of operations by the service provider on data supplied in whole or in part by the customer to extract the required information in an appropriate form or to convert the data to usable information. The nexus safe harbor provision is clarified to include computer software so that the storage of computer software on servers located in Washington State would not establish nexus for the purpose of determining whether a business must pay state taxes. The amnesty provision has been amended by providing amnesty for sales taxable labor and services rendered with respect to installing, repairing, altering, or improving digital goods prior to the effective date of July 26, 2009, and requiring taxpayers seeking a refund or credit for overpaid B&O taxes to have first paid all sales tax. The definition of digital automated services has been amended to exclude data processing services, live interactive presentations, advertising services, and web hosting, storage, and back up services. The legislation mandates that sellers of digital products must file their tax returns electronically as well as pay their taxes electronically. (Special Notice, Washington Department of Revenue, June 29, 2010)