MOUNT VERNON, Wash. - Whatcom County and the city of Bellingham are suing Washington state over its determination that British Columbia residents no longer have to pay sales tax when they shop south of the border.
The state Department of Revenue announced that beginning Thursday, the Canadian province was switching to a new tax system and no longer technically had a sales tax. That meant British Columbia residents would qualify for a sales tax exemption given to people from states and provinces without a sales tax.
Whatcom County and Bellingham sued Wednesday in Skagit County Superior Court, and a judge ordered the state to advise retailers that its interpretation has been challenged.
Revenue Department spokesman Mike Gowrylow says stores could be liable for upaid taxes if the court eventually rules against the state.