WAWG
Some of the most helpful tax preferences for farmers and ranchers are up for review in the 2016 Washington state legislative session. Many have received preliminary recommendations from the Joint Legislative Audit and Review Committee (JLARC) to be further reviewed and clarified. The tax credits for diesel fuel used on farms and for farm machinery replacement parts are among the preferences at risk to be discontinued. Both preferences were enacted in 2006 in the wake of stagnant crop prices and rising input costs.
Washington ag producers need to have every competitive advantage possible to compete on a national and international level. Nearly all of the top, wheat-producing states have tax preferences that are equal to or better than ours. Many states don’t charge sales tax on new and used equipment purchases. Quite a few states include tax exemptions on both gasoline and diesel for fuel used on the farm.
Ag tax preferences are not only helpful to farmers, they are helpful to our state. For every dollar of state investments in agriculture, $1.30 is generated in state tax payments through direct and secondary impacts. The economic and fiscal impact study on Washington state agriculture and food processing estimates 220,600 jobs are supported statewide by our industry.
Other tax preferences under review that help our industry are:
• Grain and unprocessed milk wholesaling (B&O tax);
• Warehouse and grain elevator remittance (sales and use tax);
• Agricultural products (property tax);
• Farming machinery and equipment (property tax);
• Shipping farm products to port (public utility tax);
• Leased irrigation equipment (sales and use tax);
• Seed Conditioning (B&O tax);
• Conditioned seed wholesaling (B&O tax);
• Custom farming (B&O tax); and
• Hauling farm products for relatives (public utility tax).