WA State Sales Tax on Ludicrous Retrofit

I tried to apply the battery purchase concept to my electric motorcycle. They denied my claim all the way up to the appeal and charge me $100 in road tax a year too, soon to be $150 for a motorcycle. I asked "do you know how many times you would have to fill up a gas motorcycle to get to $150?"

They didn't care. The law is the law. Stupid politicians and there selective enforcers.

A couple of years ago I testified on a bill that would have added motorcycles to the EV sales tax waiver. I pointed out I was a volunteer and unaffected, just trying to do what was best for the citizenry - and I thought I made a decent case. I don't remember what committee it was, but the complete lack of interest in what I presented was grating.

Not only did that bill not pass, none of the six EV bills that I testified on that year passed. In fact I don't think any of them even made it out of committee.

Anyways. PatT, your reading sounds reasonable, and it seems worth pursuing. But as walla2 notes, the DOR is not always friendly in a "new" type of situation. Certainly nobody there gets paid more if they say "yes"; they only get in trouble if they don't say "no" when they should have. Tesla has sales tax waiver forms that I think (?) they will send to the DOR for you if they agree with your reading, but if the DOR turns them down you will have to pay it.

RCW 82.08.816:

1) The tax imposed by RCW 82.08.020 does not apply to:

(a) The sale of batteries for electric vehicles;

I have a dealer invoice charging me 5000 for the bike and 4950 for the batteries. Line itemed out.

I got charged taxes on both. The nice thing with Tesla is they can not charge sales tax at their site and keep a copy of the exemption form on hand. The problem I had is I had to register the vehicle with the DOL and they refused to follow the law out of the "no" policy despite what the law saws. The DOR denied my appeal because I bought the batteries with the bike. What does that mean? The law doesn't indicate anything about timing. Selective and interpretative enforcement of laws that don't apply.

I'm going after them again when I renew my tabs since the law eliminated the EV tag tax from July to December this year.

PatT said:

Yes. It doesn't say that the exemption doesn't apply when the battery is bought with the vehicle. I think you definitely have a good argument. Of course if the dealer had written the sale up on two different invoices, the DOR wouldn't even have that issue. Just to be sure, you could have bought the battery the next day.

Now if Tesla would just split out the cost of the battery and you could buy a Model X one day and the battery the next. The sales tax on the cost of the 90kw battery would be significant.

Tesla should definitely consider a pricing structure like that for Model 3. It might be more likely that the cost of the car would be under the magic $35k for the sales tax exemption. If the initial sale provided enough battery to provide a 35 mile range and the customer could later add an upgrade to the battery, probably with unlimited supercharging, .........

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I put up a separate thread about that on the model 3 forums. Considering how big Washington is for EV sales, I'm really hoping they put something in place that allows for some upgrades to a base $34,995 model that would help avoid the sales tax for masses buying the model 3.

Have the work done at the Tigard, OR SC?

Big-T said:

I put up a separate thread about that on the model 3 forums. Considering how big Washington is for EV sales, I'm really hoping they put something in place that allows for some upgrades to a base $34,995 model that would help avoid the sales tax for masses buying the model 3.

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"So do I buy it with the ___ option -- triggering the sales tax on the whole vehicle -- or pay the $2,000 retrofit cost to add it after purchase -- so I only pay sales tax on the retrofit?"

BerTX said:

Have the work done at the Tigard, OR SC?

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For the upgrade, I will seriously consider this if the duration in the shop is short enough to. At 2.5k labour, I would imagine it being ~3 days. I work down in Oregon enough that I can likely swing this.
Another consideration is whether Tigard has the right training and equipment in place to open, and work on, the high voltage packs. I've visited both SCs and Seattle SoDo appears more mature due to their prior roadster work. Talking to the SoDo folk last week, they couldn't confirm whether they were a sanctioned option, though I got the strong impression that was more due to them being unable to talk about it as they have certified high power engineers.

However, I consider doing this in Oregon to be the last resort as I cannot read anything that indicates this would not be covered due to it being an upgrade to the fundamental electric drive system... ;-).

PatT said:

Tesla should definitely consider a pricing structure like that for Model 3. It might be more likely that the cost of the car would be under the magic $35k for the sales tax exemption. If the initial sale provided enough battery to provide a 35 mile range and the customer could later add an upgrade to the battery, probably with unlimited supercharging, .........

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You should contact the VP of sales directly and suggest this

I got a negative in writing for annual service and L upgrade from Seattle, even though I am from a non sales tax state. I switched to OR where I picked the car up. Haven't made up my mind on the L upgrade as it looks like a poor deal, no way can it take 3 days.

PatT said:

i got a positive ruling from the Seattle SC on the sales tax exemption for the retrofit. Now it is just the matter of when the parts will be available and when will they have service techs trained.

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Funnily enough I got a "no one knows yet" from SoDo (Marie iirc) yesterday. Who said "yes"? They sound better informed

PatT said:

I have been working with Danny Melville the assistant service manager in Seattle. He said that he got the ruling from accounting.

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Thanks. He would know best