Gross Receipts:
Washington DOR Addresses Taxation of Tariff and Credit Card Processing Fee Surcharges
Tax Topic: Surcharges including tariffs, Wash. Dept. of Rev. (12/23/24). The Washington Department of Revenue (Department) issued guidance on Washington’s tax treatment of certain “surcharges” added by businesses to customer invoices to cover expenses such as tariffs, fuel costs, and credit card processing fees – concluding that these surcharges generally are subject to tax in Washington (i.e., subject to Washington’s business and occupation (B&O) tax and retails sales tax). In doing so, the Department notes that such surcharge(s), including tariffs, are included in the selling price and cannot be deducted from the selling price even if they are listed separately on the invoice. The Department also explains that surcharges generally are taxable under the same tax classification used to report the payment of the good or service purchased. The guidance includes examples to illustrate the Washington tax treatment of such business surcharges. Please contact us with any questions.
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