Interwest Construction Inc 12/27/2018

I CITY OF EVERETT SPECIAL PROVISIONS 1-07.2 State Sales Tax I The Washington State Department of Revenue has issued special rules on the State sales tax. Sections 1-07.2(1) through 1-07.2(3) are meant to clarify those rules. The Contractor should contact the Washington State Department of Revenue for answers to questions in this area. The City will not adjust its payment if the Contractor bases a Bid on a misunderstood tax liability. The Contractor shall include all Contractor-paid taxes in the unit bid prices or other contract amounts. In some cases, however, state retail sales tax will not be included. Section 1-07.2(3) describes this exception. The City will pay the retained percentage only if the Contractor has obtained from the Washington State Department of Revenue a certificate showing that all Contract- related taxes have been paid (RCW 60.28.050). The City may deduct from its payments to the Contractor any amount the Contractor may owe the Washington State Department of Revenue, whether the amount owed relates to this Contract or not. Any amount so deducted will be paid into the proper State fund. 1 1-07.2(1) State Sales Tax — Rule 171 WAC 458-20-171, and its related rules, apply to building, repairing, or improving streets, roads, etc., that are owned by a municipal corporation. or political subdivision of the state, or by the United States, and that are used primarily for foot or vehicular traffic. This includes storm or combined sewer systems within and included as a part of the street or road drainage system and power lines when such are part of the I roadway lighting system. For Work performed in such cases, the Contractor shall include Washington State Retail Sales Taxes in the various unit bid item prices, or other contract amounts, including those that the Contractor pays on the purchase of the materials, Equipment. or supplies used or consumed in doing the Work. 1-07.2(2) State Sales Tax — Rule 170 WAC 458-20-170, Retail Sales Tax, and its related rules, apply to the constructing and I repairing of new or existing buildings, or other structures, upon real property. This includes, but is not limited to, the construction of streets, roads, highways, etc., owned by the State of Washington; water mains and their appurtenances; sanitary sewers and sewage disposal systems unless such sewers and disposal systems are within, and a part of. a street or road drainage system; telephone, telegraph, electrical power distribution lines, or other conduits or lines in or above streets or roads, unless such power lines become a part of a street or road lighting system; and installing or attaching of any article of tangible personal property in or to real property, whether or not such personal property becomes a part of the realty by virtue of installation. For Work performed in such cases, the Contractor shall collect from the City, retail sales tax on the full Contract price. The City will automatically add this sales tax to each payment to the Contractor. For this reason, the Contractor shall not include the retail sales tax in the unit bid item prices, or in any other Contract amount subject to Rule 170, with the following exception. Exception: The City will not add in sales tax for a payment the Contractor or a Subcontractor makes on the purchase or rental of tools, machinery, equipment, or consumable supplies not integrated into the project. Such sales taxes shall be included in the unit bid item prices or in any other Contract amount. 1-07.2(3) Services The Contractor shall not collect retail sales tax from the City on any contract wholly for professional or other services (as defined in Washington State Department of Revenue Rules 138 and 244). Watermain Replacement"T" Division 1 —GENERAL REQUIREMENTS October 10, 2018 WO No—UP3684 SP—80 1