Washington Rules That Business and Occupation Tax Manufacturing Rate Did Not Apply.

The Washington Supreme Court found that a manufacturer of canned chili was not subject to the Business and Occupation tax manufacturing rate of taxation, but instead could be taxed at a lower Business and Occupation rate related to perishable meat products. The State argued that the final product of the process was not a perishable meat product as the canned chili never became unsafe to consume. The court ruled that the text of the legislation did not intend to impose a perishable finished product requirement. The court found that the imposition of a perishable finished product requirement could not be justified since the subject of the tax was the manufacturing activity. (Agrilink Foods, Inc. v. Washington Department of Revenue, January 13, 2005)

Posted on December 6, 2005