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Can I sell products or services online without violating e-commerce laws in Washington? What are the requirements?

To sell products or services online in Washington, you must comply with the state’s e-commerce laws. Here are the requirements you need to consider:

License Requirements for Distributors and Retailers [1.1]

If you are selling vapor products, you must obtain a license as a distributor and retailer. You are also liable for the tax imposed on vapor products acquired from an unlicensed person that are held for sale, handling, or distribution in the state.

Mail and Internet Sales [3.1]

If you are conducting a delivery sale or shipping vapor products ordered or purchased by mail or through the internet, you must have a valid delivery sale license. You must also verify the age and identity of the purchaser through an independently operated third-party database and accept payment only through a credit or debit card issued in the purchaser’s own name. You must also include a clear and conspicuous statement on shipping documents that the package contains vapor products, Washington law prohibits sales to those under the minimum age established by this chapter, and violations may result in sanctions to both the licensee and the purchaser.

Tax Collection and Remittance [4.2]

Remote sellers, referrers, and marketplace facilitators must elect to either collect and remit retail sales or use tax on all taxable retail sales into the state or comply with RCW 82.13.020. A remote seller is subject to this requirement if its gross receipts from retail sales sourced to the state are at least ten thousand dollars. A marketplace facilitator is subject to this requirement if the gross receipts from retail sales sourced to the state by the marketplace facilitator, whether in its own name or as an agent of a marketplace seller, total at least ten thousand dollars. A referrer is subject to this requirement if the gross income of the business received from the referrer’s referral services apportioned to Washington and from retail sales sourced to the state is at least two hundred sixty-seven thousand dollars.

Sale or lease of business opportunity [2.1]

If you are offering to sell or lease a business opportunity in Washington, you must comply with the state’s regulations. An offer to sell or offer to lease a business opportunity occurs in Washington when: (a) The offer is made in Washington; or (b) The purchaser resides in Washington at the time of the offer and the business opportunity is or will be located, in whole or in part, in the state of Washington; or (c) The offer originates from Washington; or (d) The business opportunity is or will be, in whole or in part, located in Washington.

Exemptions—Digital products—Business buyers—Concurrently available for use within and outside state [4.1]

The tax imposed by RCW 82.08.020 does not apply to the sale of digital goods, digital codes, digital automated services, prewritten computer software, or services defined as a retail sale in RCW 82.04.050(6)(c) to a buyer that provides the seller with an exemption certificate claiming multiple points of use. A buyer is entitled to use an exemption certificate claiming multiple points of use only if the buyer is a business or other organization and the digital goods or digital automated services purchased, or the digital goods or digital automated services to be obtained by the digital code purchased, or the prewritten computer software or services defined as a retail sale in RCW 82.04.050(6)(c) purchased will be concurrently available for use within and outside this state.

Exemptions—Sales to nonresidents of tangible personal property, digital goods, and digital codes for use outside the state—Proof of nonresident status—Penalties [4.3]

An exemption from the tax levied by RCW 82.08.020 in the form of a remittance from the department is provided for sales to nonresidents of this state of tangible personal property, digital goods, and digital codes. The exemption only applies if: (a) The property is for use outside this state; (b) The purchaser is a bona fide resident of a province or territory of Canada or a state, territory, or possession of the United States, other than the state of Washington; and (i) Such state, possession, territory, or province does not impose, or have imposed on its behalf, a generally applicable retail sales tax, use tax, value added tax, gross receipts tax on retailing activities, or similar generally applicable tax, of three percent or more; or (ii) If imposing a tax described in (b)(i) of this subsection, provides an exemption for sales to Washington residents by reason of their residence; and (c) The purchaser agrees, when requested, to grant the department of revenue access to such records and other forms of verification at the purchaser’s place of residence to assure that such purchases are not first used substantially in the state of Washington.

In summary, to sell products or services online in Washington, you must comply with the state’s license requirements for distributors and retailers if you are selling vapor products. You must also have a valid delivery sale license if you are conducting a delivery sale or shipping vapor products ordered or purchased by mail or through the internet. Additionally, remote sellers, referrers, and marketplace facilitators must elect to either collect and remit retail sales or use tax on all taxable retail sales into the state or comply with RCW 82.13.020. If you are offering to sell or lease a business opportunity in Washington, you must comply with the state’s regulations. Finally, exemptions are available for sales to nonresidents of tangible personal property, digital goods, and digital codes for use outside the state, subject to certain conditions and limitations.

Source(s):
Jurisdiction

Washington