Washington's excise tax is a state sales tax on specific goods, not a general income tax
Washington has no state income tax, but it does tax certain products at the point of sale. An excise tax is a per-unit or percentage tax on particular items — things like gasoline, cigarettes, alcohol, and recreational marijuana. The tax is built into the price you pay at the register. Washington uses excise taxes to fund specific state programs: gas tax money goes to transportation, tobacco tax revenue funds health programs, and marijuana tax revenue supports drug treatment and prevention.
The excise tax rate varies by product. Gasoline, for example, is taxed at a flat rate per gallon that changes when the legislature passes new law. Cigarettes are taxed per pack. Alcohol has different rates depending on whether it is beer, wine, or spirits. Recreational marijuana has a percentage-based tax. Each tax is separate, and each funds different state services.
You do not file anything related to excise tax as an individual. The business selling the product collects the tax and sends it to the state Department of Revenue. If you buy a gallon of gas or a pack of cigarettes in Washington, the excise tax is already included in the price displayed.
Key Takeaways
- Washington excise taxes apply to gasoline, cigarettes, alcohol, and recreational marijuana, with different tax rates for each product.
- The tax is collected by the seller at the point of sale and remitted to the state, so you pay it automatically when you buy the product.
- Excise tax revenue is dedicated to specific programs: transportation, health initiatives, and drug treatment services.
- Washington residents and visitors both pay excise tax on these products; there is no exemption based on residency or income.
Gasoline excise tax and transportation funding
Washington's gas tax is one of the most visible excise taxes. As of 2024, the state gas tax is approximately 49.4 cents per gallon, though this rate adjusts quarterly based on a formula tied to inflation and construction costs. The rate can go up or down, and the state legislature can also change it by passing new law. You see this tax every time you fill up — it is included in the per-gallon price shown on the pump.
The gas tax funds the state's transportation budget, which pays for road maintenance, bridge repairs, public transit projects, and highway construction. When you pay the gas tax, you are funding these projects in your region and statewide. The tax applies to all gasoline sold in Washington, whether you are a resident or visiting.
Diesel fuel has a separate excise tax rate, also collected per gallon. Heavy trucks and commercial vehicles pay this tax just as personal vehicles do. Some fuel uses — such as fuel for agricultural equipment or certain industrial purposes — may have tax exemptions or refund processes, but these are handled by the business using the fuel, not by individual drivers.
Cigarette and tobacco excise tax
Washington taxes cigarettes at $3.025 per pack of 20 cigarettes as of 2024, though the legislature can change this rate. Other tobacco products — cigars, chewing tobacco, snuff — are taxed at a percentage of the wholesale price, typically around 95 percent. The tax is collected by the retailer when you buy the product and sent to the state.
Cigarette and tobacco tax revenue funds the state's health programs, including smoking cessation programs, youth prevention efforts, and Medicaid. The tax is designed both to raise revenue for these programs and to discourage tobacco use by raising the cost of the product.
The tax applies uniformly across Washington. There is no lower rate for seniors, no exemption for low-income purchasers, and no difference based on where in the state you buy the product. Online purchases and mail orders of cigarettes are also subject to the tax, though the collection method differs — the seller must report the sale to the state and the tax is owed even if not collected at the point of sale.
Alcohol excise tax rates by beverage type
Washington taxes beer, wine, and spirits at different rates. Beer is taxed at approximately $0.1384 per 12-ounce can or bottle. Wine is taxed at roughly $0.87 per liter. Spirits (liquor) are taxed at about $13.67 per liter. These rates change when the legislature passes new tax law, so the exact amount varies year to year.
The tax is collected by the distributor or retailer and included in the price you pay. You do not see it as a separate line item — it is built into the shelf price. The tax applies to all alcohol sold for off-premises consumption (liquor stores, grocery stores) and on-premises consumption (bars, restaurants).
Alcohol tax revenue funds state health and social programs, including substance abuse treatment and prevention. Like other excise taxes, there is no exemption based on income or age (beyond the legal drinking age requirement for purchase itself).
Recreational marijuana excise tax
Washington's recreational marijuana market has a excise tax of 37 percent applied at the wholesale level — meaning the tax is built into the price before the product reaches the retail shelf. This is in addition to regular sales tax, which also applies to marijuana purchases. The combined tax burden on marijuana is higher than on most other products.
The excise tax is collected by licensed producers and wholesalers and sent to the state Department of Revenue. Retailers then add the regular state and local sales tax on top. When you buy marijuana at a licensed retailer, both taxes are included in the final price.
Marijuana excise tax revenue funds drug treatment programs, prevention initiatives, and public health efforts related to substance use. The tax applies to all recreational marijuana sold through licensed retailers in Washington. Medical marijuana purchased by patients with a valid authorization has different tax treatment and is not subject to the full excise tax.
Who collects excise tax and where the money goes
Excise taxes are collected by the business selling the product — the gas station, liquor store, tobacco retailer, or marijuana retailer. That business is responsible for calculating the tax, collecting it from you, and sending it to the Washington Department of Revenue on a regular schedule (usually monthly or quarterly, depending on the business size and tax type).
The state Department of Revenue tracks these payments and deposits the money into dedicated accounts. Each excise tax has a specific purpose: gas tax goes to transportation, tobacco tax to health programs, alcohol tax to health and social services, and marijuana tax to drug treatment and prevention. The legislature decides how much of each tax revenue goes to which programs within those broad categories.
You do not file any paperwork or claim any refunds related to excise tax as an individual consumer. The tax is final at the point of sale. Businesses that use these products for commercial purposes may be able to claim refunds or exemptions in some cases — for example, a farm may be able to get a refund on fuel tax for agricultural use — but those processes are handled between the business and the Department of Revenue.
Excise tax versus sales tax in Washington
Washington has both excise taxes and a general sales tax. The sales tax applies to most goods and services and varies by location (typically 8 to 10 percent depending on your county and city). Excise taxes are separate and apply only to specific products.
When you buy a gallon of gas, you pay the gas excise tax per gallon plus the regular sales tax on the total purchase. When you buy a pack of cigarettes, you pay the cigarette excise tax per pack plus sales tax. When you buy marijuana, you pay the 37 percent excise tax plus sales tax. These taxes stack — they are not alternatives to each other.
The key difference is that excise taxes are dedicated to specific programs, while general sales tax revenue goes into the state's general fund and is allocated by the legislature for various purposes. Excise taxes are also typically higher per unit than sales tax would be on the same product, which is intentional — they are designed to both fund specific programs and discourage consumption of the taxed item.
Frequently Asked Questions
Do I pay excise tax if I buy these products outside Washington and bring them in?
If you buy gasoline, cigarettes, or alcohol outside Washington and bring it into the state for personal use, you do not owe additional excise tax. However, if you are a business bringing products in for resale, you must pay Washington excise tax. Marijuana purchased outside Washington cannot legally be brought into the state.
Can I get a refund on excise tax I paid?
Individual consumers cannot get refunds on excise tax paid at the pump or register. Businesses may be able to claim refunds or exemptions for certain uses — for example, farmers can sometimes get refunds on fuel tax for agricultural equipment — but you would need to contact the Department of Revenue to learn about specific business exemptions.
What happens if a business does not collect or pay the excise tax?
The Department of Revenue audits businesses that sell excise-taxed products. If a business fails to collect or remit the tax, it faces penalties, interest, and potential legal action. The tax is a legal obligation, and the state actively enforces collection.
Does excise tax apply to online purchases?
Excise tax applies to online purchases of gasoline (not applicable), cigarettes, alcohol, and marijuana sold through licensed retailers. For cigarettes and alcohol ordered online, the seller must collect the tax or report the sale to the state so the tax can be owed. Marijuana can only be legally purchased through licensed retailers in Washington, including some with online ordering.
Are there any groups that do not have to pay excise tax?
Excise tax applies to all consumers regardless of age (except for alcohol and marijuana, which have legal age restrictions for purchase), income, or residency status. There are no exemptions for low-income individuals, seniors, or other groups. Businesses may have exemptions for certain uses, but individual consumers do not.