Senate bill 6402 has passed the Senate and is pending before the House Finance committee. This bill will permanently recognize beekeepers as farmers for the purposes of taxation. This bill would exempt beekeepers from paying B&O tax on sales of queen bees, packaged bees, honey, pollen, bees wax, propolis, or other substances obtained from honey bees, and on pollination services. There are two reasons this should pass.
1) Our bees do much good for the environment in pollinating, both for commercial agriculture and in town and city gardens and landscapes in Washington. We all know beekeeping is an agricultural pursuit. As beekeepers, we are regulated by, and register our hives with, the Washington State Department of Agriculture, but currently we are taxed as if we are not associated with agriculture. Farmers have a permanent exemption to B&O tax, not so for beekeepers. It is fair that we be considered a part of agriculture and not be subject to B&O taxes.
2) Current implementation of the B&O tax puts Washington beekeepers at a competitive disadvantage to out-of-state beekeepers. According to the fiscal note attached to the bill, only a handful of beekeepers are paying the B&O tax on pollination services. It’s doubtful that any out-of-state beekeepers pay it. Yet, the National Agricultural Statistics Service (NASS 2007) reports about 330,000 acres of apples, 80,000 acres of cherries, 51,000 acres of pears, 21,000 acres of seed crops, and 40,000 acres of berries in Washington state, almost all of which need pollination at a rate of 1 to 2 hives per acre at least.
The Washington State Department of Agriculture (2013) reports about 80,000 registered hives in our state. The vast majority of hives for pollination come from out-of-state. Foreign beekeepers owe B&O tax (have “economic nexus” with Washington state) if they have more than $50,000 of property in our state for money making purposes. A semi-truck load of 400 hives valued very conservatively at $125 each meets the economic nexus threshold. For tree fruit pollination, most out-of-staters bring many semi-truck loads. Foreign beekeepers should pay B&O but don’t. This fact puts those in-state beekeepers who do pay at a disadvantage to those out-of-staters who don’t.
I have spoken with the Department of Revenue about how they should collect B&O from out-of-state beekeepers also, but they haven’t come up with a method, seeing that the bees arrive by night, leave by night and have no permanent presence in Washington. In summary, this competitive disadvantage to Washington state beekeepers should be removed.
Passing this bill into law is in the long-term interest of beekeeping in Washington, especially if you sell items as part of your beekeeping. The WSBA asks your help in making this bill become law. SB 6402 is currently before the House Finance committee. The members of this committee are:
- Carlyle, Reuven, Chair
- Tharinger, Steve, Vice Chair
- Nealey, Terry
- Orcutt, Ed
- Condotta, Cary
- Fitzgibbon, Joe
- Hansen, Drew
- Lytton, Kristine
- Pollet, Gerry
- Reykdal, Chris
- Springer, Larry
- Vick, Brandon
- Wilcox, J.T.
This list is also found at http://www.leg.wa.gov/House/Committees/FIN/Pages/MembersStaff.aspx where you can find their Olympia office phone numbers to leave messages. Also, if you click on their name on that page, it takes you to a page which shows their legislative district and their email address. Whether or not you are in their district, you can send a message, but especially if you are in their district you should let them know your thoughts on this bill. For more details about the bill, see http://apps.leg.wa.gov/billinfo/summary.aspx?year=2014&bill=6402 especially the Second Substitute Senate Bill Report on that page. That report has a good summary of testimony given on this bill so far.
Please let your legislators know they can help beekeepers by passing this bill.
Legislative Chair, Washington State Beekeepers Association