Alternative Fuel Vehicles and Plug-In Hybrids Washington State Tax Exemptions

On August 1, 2019, Washington State reinstated the sales and use tax exemption for the sales of:

• Vehicles powered by a clean alternative fuel.
• Certain plug-in hybrids.

The exemption applies to dealer and private sales of new, used, and leased vehicles sold on or after August 1, 2019.

• New vehicle transactions must not exceed $45,000 in purchase price or lease payments.
• Used vehicles transactions must not exceed $30,000 in fair market value or lease payments.

These thresholds may also include the value of your trade-in, if applicable.

Example

If the cost of a new vehicle is $48,000, and the value of your trade-in is worth $6,000, you can't receive the tax exemption. Even though the trade-in brought the cost down to $42,000, the new vehicle was still worth over the $45,000 limit. You cannot use a trade-in to lower the price of a vehicle to meet the exemption limits.

Related information

• The current list of qualifying vehicles (data.wa.gov)
• Frequently asked questions: Alternative Fuel Vehicles and Plug-In Hybrids Tax Exemptions
• Incentive Programs: Deferrals, Exemptions, and Credits
• RCW 82.08.809: Exemptions-Vehicles using clean alternative fuels and electric vehicles, exceptions-Quarterly transfers
• RCW 82.12.809: Exemptions-Vehicles using clean alternative fuels and electric vehicles, exceptions-Quarterly transfers
• E2SHB 2042 - Laws of 2019: Advancing Green Transportation Adoption
• Electric vehicle population and transaction interactive data sets (data.wa.gov)

Questions? Need help?

Call DOR's Tax Assistance line: 360.705.6705