Thursday, March 6, 2014

State of Washington Approves BMW i3 REx For Sales Tax Exemption

A little over a month ago we learned that BMW i3 REx buyers in New Jersey wouldn't have to pay sales tax on the vehicle as the State was including it in the zero emission vehicle tax exemption. That will obviously help i3 REx sales immensely since it will likely save the average i3 REx buyer in New Jersey about $3,500. There was never a question of whether the BEV i3 would be tax exempt, since it is truly a zero emission vehicle, but the i3 REx isn't. The range extended Chevy Volt, for example is not tax exempt in NJ. The reasoning behind the i3 REx exemption is two fold. First, the i3 REx has about an 80 mile all electric range which is more than double the Volt's. This means for most buyers the i3 REx will likely be driven on electric much more than the average Volt owner drives their car on electricity. Secondly, the i3's range extender isn't as robust as the Volts. You could easily drive the Volt all the time without ever plugging it in. I don't know why you would buy a Volt and do that, but you could without any problem. The i3 REx on the other hand could not be driven like that, and it really needs to be charged and driven in electric mode most of the time.

So today we got news that Washington State followed New Jersey's lead and certified both the i3 BEV and i3 REx to get the State's zero emission tax exemption, saving i3 REx buyers in The Evergreen State a good chunk of change. In fact, most i3 REx buyers there will likely save as much as the REx option costs-$3,850!

I noticed that InsideEVs just put up a post about this and since I'm currently in Geneva covering the Geneva Motor show for them I figured I'd "borrow" Eric Loveday's post on this. Below is the full post he made for

“We ARE smarter than California,” says Washington state representative Chad Magendanz.
BMW i3 With REx Qualifies For Sales Tax Exemption in Washington
BMW i3 With REx Qualifies For Sales Tax Exemption in Washington
Magendanz made that statement before and now he’s saying it again.
When Magendanz stated that previously, it was to make it know that he was urging the state of Washington to grant the BMW i3 REx sales tax exemption.  This idea was that Washington would jump in front of California, a state that seems reluctant to award EREVs due to the ICE on board.
Now, Magendanz is saying “We ARE smarter than California” again, but this time it’s to celebrate the fact that the i3 REx will be sales tax exempt in Washington.
Per the press release sent to InsideEVs:
  • Dept. of Revenue reverses itself, says new electric BMW with made-in-WA parts will get tax exemption after all
  • State Rep. Chad Magendanz was happy to find out that one of his prime-sponsored bills is unnecessary, now that a state agency has reversed its position on a tax exemption for electric cars.
The Issaquah Republican had been pushing legislation to clarify that electric vehicles such as the new BMW i3 qualify for a state sales tax exemption. The state Department of Revenue (DOR) told Magendanz last month that the i3 – which has carbon fiber parts made in Washington – wouldn’t qualify because of an optional gas-powered “range extender” BMW offers to consumers worried about their car running out of power. Magendanz introduced the bill to counter the department’s interpretation of the exemption law, but last week DOR informed lawmakers it had changed its mind.
“It’s a great thing when common sense prevails in government,” said Magendanz. “Unlike California, Washington is sending the message that we encourage innovative, environmentally-friendly automotive technology.”
The issue of the sales tax exemption came to Magendanz’s attention when he read that California had backed out of a deal with BMW to grant the i3 the state’s coveted “Clean Air Vehicle” white decal, which gives drivers full access to HOV lanes. California said the range extender – even though it’s optional and not permanently connected to the car – compromised the i-3’s status as a solely electric vehicle.
The i3 is expected to hit the U.S. market this spring. SGL Group in Moses Lake produced carbon fiber components for the car’s passenger compartment.
The bolded statement of “not permanently connected to the car” is clearly inaccurate when one opts for the i3 with REx.  And some of the anit-California comments are untrue too, such as the i3 not qualifying for the white sticker, which is actually does, provided its the BEV version.
Washington joins New Jersey, site of BMW’s US headquarters, in exempting the i3 REx from sales tax.

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