SALT Report 3031 – The Washington Department of Revenue issued an excise tax advisory to clarify the requirements that must be met to qualify for the preferential B&O tax treatment for warehousing and reselling prescription drugs. Under the provisions of RCW 82.04.272, a preferential B&O tax rate of 0.138% is available to persons “engaging in the business of warehousing and reselling drugs for human use pursuant to a prescription.”
To qualify for the preferential rate, the seller must meet all of the following conditions:
- Purchase prescription drugs from a manufacturer or wholesaler,
- Warehouse and resell the prescription drugs. The warehousing is not required to occur in Washington,
- Be registered with the federal Drug Enforcement Administration, and
- Be licensed by the Pharmacy Quality Assurance Commission as either a wholesaler or a retailer
Qualified sales must be made to a buyer that is either:
- A retailer with a pharmacy facility license or nonresidential pharmacy license issued by the Department of Health, or
- A hospital, clinic, health care provider, or other provider of health care services
SALT Report 2998 previously reported the Department’s intention to adopt these provisions.
For Further Information
Washington Department of Revenue – Excise Tax Advisory No. 3180.2013
