Are transfers of precious metals between Washington residents subject to state sales or use tax?
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Executive summary
Washington repealed its long‑standing sales‑and‑use tax exemption for “precious metal bullion” and “monetized bullion” in 2025; effective January 1, 2026, sales that had generally been exempt will be treated as taxable retail sales and subject to retail sales tax and retailing B&O tax where applicable (Washington Department of Revenue; legislative changes, ESSB 5794) [1] [2]. Industry and dealer accounts confirm the repeal and warn purchasers in high‑tax localities may face combined state and local rates up to roughly 6.5% plus local levies (industry reporting and dealer advisories) [3] [4].
1. What changed — law, timing, and scope
The Washington Legislature in 2025 altered the statutory treatment of bullion: ESSB 5794 and related actions remove the longstanding exclusion from definitions of wholesale and retail sales, meaning gross income from sales of precious metal bullion and monetized bullion will be taxable effective Jan. 1, 2026 (Washington Department of Revenue guidance and special notices) [1] [2]. Prior DOR guidance and rules such as WAC 458‑20‑248 had treated qualifying bullion and monetized bullion as generally exempt; the new law reverses that position [5] [2].
2. Exactly which items are in play
“Precious metal bullion” is defined as metal put through smelting/refining whose value depends on metal content rather than form (gold, silver, platinum, palladium, rhodium cited by DOR). “Monetized bullion” covers coins or other forms of money manufactured from such metals and used as legal tender; the law’s text and DOR guidance specifically reference both categories [1] [2] [6].
3. Who pays the tax — residents and dealers
Under the change, sales that are subject to retailing B&O tax are also subject to retail sales tax; dealers who make retail sales of bullion must collect and report sales tax on those transactions starting Jan. 1, 2026 (Washington DOR guidance) [2] [6]. Past guidance noted paper currency sold as legal tender remained exempt, but the new statutory framework explicitly pulls bullion and monetized bullion into taxable tangible‑personal‑property transactions [5] [2].
4. How big the bill might be — rates and local add‑ons
Sources cite Washington’s state sales tax base (commonly 6.5%) plus local and county additions, producing combined rates materially higher in some jurisdictions; industry commentary warns buyers could face roughly the statewide rate plus local surtaxes when purchasing bullion (dealer advisories and state tax descriptions) [4] [3]. Exact totals depend on the purchaser’s location and local levies (available sources discuss local add‑ons but do not list every jurisdiction) [4].
5. Industry reaction and political context
Precious‑metals dealers and numismatic groups lobbied to retain the exemption; trade organizations publicly criticized the repeal as harmful to local dealers and collectors, describing it as a setback for the state’s numismatic and bullion market (industry press and National Coin & Bullion Association statements covered by reporting) [7]. Legislative reviews (JLARC) and policy debates that preceded the change questioned whether the exemption met its original competitiveness objective, which helped lawmakers justify repeal (dealer blog and reporting summaries) [8].
6. Practical implications for transfers between residents
If a transfer is a retail sale of taxable bullion between a Washington seller and a Washington buyer, the new law and DOR guidance indicate it will generally be subject to retail sales tax and retailing B&O tax collection responsibilities for the seller as of Jan. 1, 2026 (DOR special notices and industry FAQs) [1] [2]. Available sources do not specifically address casual or private transfers (gift, private person‑to‑person sales outside a dealer), so the treatment of those precise scenarios is “not found in current reporting.”
7. Where reporting and secondary sources diverge
Most official DOR materials and multiple industry outlets align on the repeal and Jan. 1, 2026 effective date [1] [2] [3]. Some commercial guides published earlier or not updated still describe the prior exemption — those must be read against DOR’s 2025 notices. State guidance is the controlling source for compliance [5] [6].
8. What buyers and dealers should do now
Dealers should update pricing, tax collection, and sales‑tax remittance systems for the January 2026 change and communicate increased total costs to customers; industry advisories urge customers to plan purchases accordingly and to check local rates (dealer and industry guidance) [3] [8]. For specific questions about private transfers, exemptions, or unusual coins, rely on Washington DOR rulings or consult a tax professional because available sources do not provide exhaustive private‑sale rules [2] [5].
Limitations: This summary relies solely on Washington DOR guidance and contemporaneous industry reporting in the provided sources; it does not attempt to interpret statutory text beyond those sources and flags where the reporting is silent about private transfers [1] [2] [3].