Alternative Fuel Vehicle (AFV) Retail Sales and Use Tax Exemption

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The retail sales and state use tax of 6.5% does not apply to the sale or lease of new or used passenger vehicles, light-duty trucks, and medium-duty passenger AFVs. AFVs powered by natural gas, propane, hydrogen, and electricity are eligible. Vehicles must not have a selling price plus trade-in property value that exceeds $45,000 for new vehicles and $30,000 for used vehicles. The maximum eligible amount for used purchased or leased vehicles is $16,000. The maximum eligible amounts for new purchased or leased vehicles are as follows:

Newly Purchases or Leased YearMaximum Amount
Through July 31, 2021$25,000
August 1, 2021 - July 31 2023$20,000
August 1, 2023 - July 31 2025$15,000

For more information, see the Renewable Energy/Green Incentives section of Washington Department of Revenue's Incentives Programs website.

(Reference Revised Code of Washington 82.12.9999)