How does Washington’s 2026 bullion tax interact with use tax and private out‑of‑state purchases?
Executive summary
Washington’s 2026 law ends a long-standing exemption and brings sales of precious metal bullion and monetized bullion squarely into the state’s retail sales tax and Business & Occupation (B&O) tax regimes for retail sellers, while wholesale sales remain treated differently if a reseller permit is provided [1] [2]. That change does not erase use‑tax exposure when Washington residents buy bullion outside the state or store purchases out of state — those transactions can still trigger Washington use tax, even if an out‑of‑state seller does not collect sales tax [3] [4].
1. What the new bullion tax actually does: retail sales, B&O and wholesale carveouts
Effective Jan. 1, 2026, Washington reclassifies gross income from sales of precious metal bullion and monetized bullion as taxable retail sales subject to retailing B&O tax and sales tax when sold to end consumers, while sales to resellers can be taxed at the wholesaling B&O rate provided the buyer furnishes a valid reseller permit — and wholesale sales are not subject to retail sales tax [1] [2] [5]. State guidance is explicit: bullion previously excluded from the definition of wholesale or retail sales is no longer exempt and must be treated like other tangible personal property for sales- and B&O‑tax purposes [1] [2].
2. How sales tax collection works for in-state and remote sellers
Retailers selling bullion at retail in Washington must collect and remit state and applicable local sales taxes at the point of sale, and the Department of Revenue has signaled that online/remote sellers shipping to Washington addresses are likewise within scope for collection obligations [1] [3] [5]. Industry and dealer accounts anticipate the tax will add roughly the same combined state and local rate that applies to other consumer goods, a hit dealers and buyers repeatedly note in local reporting and industry commentary [6] [7].
3. The use‑tax interaction: buying out of state doesn’t automatically eliminate Washington tax exposure
The law change does not mean a Washington resident can permanently avoid state tax exposure by purchasing bullion outside Washington; Washington’s use tax framework — referenced in dealer advisories and consumer guides — is the mechanism that puts the tax on purchases brought into the state for use or storage, and dealers warn that storing purchases out of state can be an alternative but carries legal and practical limits [4] [3]. Reporting and numismatic commentary note common avoidance strategies — traveling to a neighboring state to buy bullion and placing it in an out‑of‑state safe deposit box — but also caution that smaller buyers have few practical options and that use tax liability can follow the purchaser if the bullion is brought back into Washington [4].
4. Practical enforcement and the gray area of private, out‑of‑state transactions
Sources show a split between the bright‑line rule that in‑state and shipped‑to‑Washington sales are taxable and the fuzzier reality of private out‑of‑state purchases: while the Department of Revenue requires collection when sales are made into Washington and treats bullion as tangible personal property, enforcement of use tax on private purchases can be administratively challenging and is where dealers, buyers, and trade groups focus their concerns [1] [2] [8]. Industry writers and dealers point to a likely migration of some business across state lines and to strategies that affluent buyers may use to legally avoid immediate sales tax, but those commentaries implicitly admit the state’s statutory reach remains — even if identifying and collecting use tax from individuals can lag practical enforcement [4] [8].
5. Politics, economics and who benefits or loses
Legislators and audit bodies justified the repeal by concluding the exemption was not achieving its intended competitiveness goal; the Joint Legislative Audit and Review Committee’s findings are cited in coverage explaining the change, and the state projects modest revenue from the repeal while dealers warn of disrupted local markets and lost traffic to neighboring states [9] [6] [8]. Alternative viewpoints exist clearly in the record: the Department of Revenue frames the change as a closing of an anomalous preference and alignment with treatment of other tangible property [1] [2], while dealer associations and some local reporting portray it as a punitive, business‑harming policy that will push commerce out of Washington [8] [7].