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Washington Supreme Court upholds retroactive application of amendment to B&O tax exemption

The Washington Supreme Court held that the retroactive application of the legislature’s amendment to a business and occupation tax exemption revising the definition of direct seller’s representative to conform to the Washington Department of Revenue’s interpretation of the exemption did not violate a taxpayer’s rights under due process, collateral estoppel or separation of powers principles. The intervening, retroactive application of the amendment to the law made the company ineligible for the tax exemption. While the taxpayer argued that it should continue to be eligible for the exemption based on successful prior litigation on the issue, the court rejected this argument, pointing out that the prior decision did not apply because it involved a different tax period than the case at hand.

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