Rental Car Addendum Form - Department Of Revenue Washington State (Page 2 of 4) in pdf

RENTAL CAR TAX

GENERAL INFORMATION

Rental cars are exempt from motor vehicle excise tax and are subject instead to state and/or local rental car tax on

retail car rentals. The 5.9% state rental car tax applies in addition to the retail sales tax. All counties are

authorized to collect an additional 1% local tax on retail car rentals. However, only Franklin, King, Pierce and

Spokane Counties currently impose the 1% additional tax. In addition, Revised Code of Washington (RCW)

82.14.360 gives King County the authority to collect an additional 2% tax on car rentals to fund a new baseball

stadium.

The Regional Transit Authority (RTA) tax is imposed at the rate of .8% on car rentals within the RTA District.

This RTA tax is in addition to the RTA reported on page 1 of the excise tax return on the same retail car rental.

“Rental car” means a passenger car used solely by a rental car business for rental to others without a driver

provided by the rental car business.

Rental cars must be used solely for rental to others. Cars may be moved by the rental car business for the purpose

of relocation to another business site, or for the purpose of transporting to or from a maintenance or repair

facility. Any other use will cause a car to be subject to motor vehicle excise tax.

“Rental car” does not include:

• A car licensed and operated as a taxicab.

• A leased car that, at the time the lease agreement is signed, is rented for a continuous period of thirty

days or more.

The rental car business must register its rental cars with the Department of Licensing under one of the following

methods:

1. A rental car business may register all rental cars that are offered for rental in Washington, or

2. A rental car business with in-state and out-of-state locations may register its rental cars under

the International Registration Plan (IRP) and allocate registrations according to the provisions

of section 1116 of the IRP.

The RTA and rental car taxes reported on the Rental Car Tax Addendum are due in addition to the retail,

local, and RTA taxes reported on the Combined Excise Tax Return.

The rental car taxes may be included with the state and local retail sales taxes on your customer’s invoice. For

example, if you are in Seattle and the combined state, local and RTA sales rate is 8.9%, and the King County

rental car tax is 8.9% plus the additional car rental RTA of .8%, the total tax charged to your customer would be

18.6% OR if you are in King County outside the RTA area the sales rate is 8.5%, and the King County rental car

tax is 8.9%, the total tax charged to your customer would be 17.4%.

IF YOU NEED HELP

If you need help completing this addendum, please contact the Department of Revenue’s Telephone Information Center at

1-800-647-7706. Teletype (TTY) users may call 1-800-451-7985.

For tax assistance, visit To inquire about the availability of this form in an alternate format for the visually

impaired, please call (360) 705-6715. Teletype (TTY) users may call 1-800-451-7985.

REV 40 0027 Q3/07 (7-31-07)

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Rental Car Addendum Form - Department Of Revenue Washington State Page 2