The Washington Supreme Court says the state can collect business-and-occupation taxes from out-of-state companies that do business here even if they have no local sales force, offices or stores.
The justices ruled 6-3 Thursday against a New Jersey company called Lamtec Corp., which sells insulation and vapor barriers. Lamtec was seeking a refund of nearly $72,000 in taxes, penalties and interest from the Revenue Department. The B-and-O tax is a tax on conducting business within a state.
Under the federal Commerce Clause, states can tax out-of-state companies when there is a "substantial nexus" between the state and the company.
Lamtec argued that because it didn't have a permanent physical presence in Washington, there was no nexus. But the high court said regular visits to Washington customers by Lamtec workers was enough to subject the company to the tax.