Airplanes used for hire in interstate or foreign commerce (or sold to the U.S. government)

Airplanes sold to the U.S. government, or for carrying people or property for hire in interstate or foreign commerce, or for performing services under a U.S. government contract, are exempt from Washington sales tax. So are parts that become part of those airplanes and the labor to build, repair, clean, alter or improve them. Furnishings that are not attached, and consumable supplies, are not covered by this exemption.

Who qualifies

• The U.S. government, as buyer of an airplane. REV 27-0032 has no line for that sale; confirm with DOR how to document it.
• A buyer that will use the airplane to conduct interstate or foreign commerce by transporting persons or property for hire, as a common carrier or a private carrier (any carrier other than a common carrier in the business of transporting persons or property for hire).
• A buyer that will use the airplane to perform services under a contract with the U.S. government.

What qualifies

• Sales of the airplanes themselves.
• Component parts: all tangible personal property attached to and part of the airplane, plus spare parts designed for ultimate attachment to it, bought in the course of constructing, repairing, cleaning, altering or improving it.
• Labor and services to construct, repair, clean, alter or improve the airplane.
• Installing, repairing, altering or improving property before the carrier first uses it is part of its initial cost and exempt with it.
• Use tax: the use of an airplane used primarily in interstate or foreign commerce for hire or in U.S. government contract services, and of its component parts and repair labor, is exempt.

Not covered

• Furnishings that are not attached, and consumable supplies. The rule names bedding, linen, table and kitchen ware, tables, chairs, ice, fuel and lubricants. (Those can fall under the separate carrier goods exemption, RCW 82.08.0261, with use tax on what is consumed in Washington.)
• Labor on property that is not carrier property, such as office equipment, and laundering of linen and bedding.
• Constructing, repairing, decorating or improving buildings such as hangars.
• Airplanes used only for intrastate service. Commuter air carriers have their own branch, RCW 82.08.0262(1)(a)(iii), on form line 3.
• Meals and other goods the carrier itself sells in Washington; those are retail sales.

What the buyer gives

The Buyer's Retail Sales Tax Exemption Certificate, form REV 27 0032 (6/17/25): line 4b ("Airplanes, locomotives, railroad cars or watercraft and component parts thereof used in transporting persons or property for hire") for the airplane and parts, and line 4c ("Labor and services rendered to construct, repair, clean, alter or improve for hire carrier property") for repair and maintenance labor. The buyer ticks single use or blanket (blanket works while buyer and seller have at least one sale within 12 months), enters the seller's name, mailing address and the date, checks the line named below, lists the items purchased, and completes the certification block: type of entity, type of business, Account ID, buyer name and title, street address, and signature. The form says it is not for resale purchases. WAC 458-20-175 adds that the certificate must identify the carrier operator by name and by its DOR registration number (or by address if not registered); it may be a blanket certificate or stamped on the purchase order, and the rule prints suggested wording. The form has no separate line for sales to the U.S. government or for airplanes used under a U.S. government contract. Confirm with the Department of Revenue (360-705-6705) how to document those sales.

What the seller keeps

WAC 458-20-175: sellers of property or services within these exemptions "are required to obtain from the purchaser, or his authorized agent, a certificate evidencing the exempt nature of the transaction." Form REV 27 0032 says: "Seller must retain the original of this certificate for their records. Do not send a copy of this certificate to the Department of Revenue." A FAR part 145 certificated repair station reports its exempt retail sales under RCW 82.08.0261, 82.08.0262 or 82.08.0263 under the Federal Aviation Administration (FAR) Repair Station B&O classification at a preferential rate (DOR). RCW 82.32.070(1) requires taxpayers to "keep and preserve, for a period of five years, suitable records as may be necessary to determine the amount of any tax for which the taxpayer may be liable." Under RCW 82.08.050(4) a seller is not relieved of the tax unless it keeps proper records of exempt sales and provides them when asked; (7)(a) relieves a seller that obtains a fully completed certificate within 90 days after the sale, and (7)(b) allows 120 days after a department request to prove the sale was not taxable or obtain a fully completed certificate taken in good faith. RCW 82.04.470 governs reseller permits and wholesale sales; it is not the documentation rule for this exempt retail sale.

Common mistakes

• Exempting cabin supplies, linens and galley ware as "component parts". The rule says component parts do not include furnishings that are not attached, or consumable supplies.
• Exempting hangar construction or repair. Charges for constructing or repairing buildings such as hangars are taxable.
• Taking a certificate without the carrier's DOR registration number (or its address if not registered).
• Using line 4b for an operator that flies only within Washington. That is the commuter air carrier exemption, line 3, with its own test.

Common questions

Is a repair shop's labor on an interstate cargo airplane exempt?

Yes. Labor and services to construct, repair, clean, alter or improve carrier property are exempt, along with parts that become part of the airplane. The carrier gives line 4c (and 4b for parts) on form REV 27 0032.

Are spare parts exempt before they are installed?

Yes. WAC 458-20-175 includes spare parts designed for ultimate attachment to carrier property in "component part."

Can a charter operator buy seat covers and blankets tax-free under this line?

Not under line 4b. Unattached furnishings and consumable supplies are excluded from component parts. They may qualify under the separate carrier goods exemption (line 4d), with use tax on consumables used in Washington.

Does a sale of an airplane to a federal agency need a certificate?

RCW 82.08.0262(1)(a)(i) exempts sales of airplanes to the U.S. government. REV 27-0032 has no line for that sale (line 4b covers only transport for hire), so the seller should confirm with DOR how to document it before treating the sale as exempt.

Sources

• RCW 82.08.0262 (1)(a)(i)-(ii), (1)(c)-(d)
• RCW 82.12.0254 (1)(a), (1)(c)-(d) use tax
• WAC 458-20-175 Definitions; Retail sales tax (1)-(3); Exemption certificates required; Use tax
• DOR form REV 27 0032 (6/17/25), Buyer's Retail Sales Tax Exemption Certificate Page 1 single use/blanket; page 2 lines 4b-4c; page 5 line 4b and 4c instructions; page 4 certification and retention
• DOR Tax incentive programs Aerospace Industry: B&O tax rates for aerospace businesses (FAR Part 145 repair stations)
• RCW 82.08.050 (4), (7)(a)-(c) seller records and certificate timing
• RCW 82.32.070 (1) five-year record retention
• RCW 82.04.470 (1), (7) reseller permits and wholesale sales