The sales tax rate in Olympia, Washington is 9.8%. That combines a 6.5% state retail sales tax with 3.3% in local taxes that fund transit, public safety, and transportation projects within the city.1Washington State Department of Revenue. Local Sales Tax Change – Thurston County Public Safety Tax You’ll see it on most retail purchases, many services, and online orders delivered into the city.
How the 9.8% Breaks Down
The 6.5% state portion is the same whether you shop in Olympia, Seattle, or Spokane. It goes to the state general fund under RCW 82.08.020.2Washington State Legislature. RCW 82.08.020 – Tax Imposed, Retail Sales, Retail Car Rental
The 3.3% local piece is split among several taxing authorities. The largest share funds Intercity Transit, the regional bus system. Smaller fractions support Thurston County criminal justice programs, a county-wide public safety tax of 0.2%, and a city Transportation Benefit District tax of 0.1%. Those last two components took effect on April 1, 2024, pushing Olympia’s combined rate from 9.5% up to 9.8%.1Washington State Department of Revenue. Local Sales Tax Change – Thurston County Public Safety Tax
Local rates can change at the start of any quarter. If you’re relying on an exact figure for a large purchase or a business filing, confirm it on the Department of Revenue’s rate lookup rather than trusting a cached number.
What the 9.8% Applies To
Most physical goods sold in Olympia carry the full 9.8%: clothing, electronics, furniture, household supplies, and vehicles. Washington also taxes a broader slice of services and digital products than many other states.
Services
Construction, installation and repair work, and landscaping have long been subject to Washington retail sales tax.3Washington Department of Revenue. Services Subject To Sales Tax If you hire someone to remodel a bathroom, fix an appliance, or maintain your yard in Olympia, the 9.8% applies to the labor and the materials.
Starting October 1, 2025, Washington expanded the list of taxable services under SB 5814. The new categories include:
- Advertising services, including graphic design, ad placement, and media buying
- IT services such as tech support, data processing, custom website development, and custom software
- Live presentations, including seminars, workshops, and online courses with real-time interaction (school and accredited higher-education programs are excluded)
- Investigation and security services, including background checks, security guards, patrol, and armored car transport
- Temporary staffing supplied to businesses on a contract or fee basis (hospitals are excluded)
If your business buys any of these in Olympia, expect the 9.8% to show up on invoices going forward.4Washington Department of Revenue. Services Newly Subject To Retail Sales Tax
Digital Products
Downloads, streaming subscriptions, digital automated services, and remotely accessed software are all taxable in Washington.3Washington Department of Revenue. Services Subject To Sales Tax The rate follows where you receive or first use the product, not where the seller sits.
What’s Exempt
Two exemptions matter for most Olympia shoppers: groceries and prescription medications.
Food and food ingredients sold for home preparation are exempt from Washington sales tax, including produce, meat, dairy, and canned goods. The exemption does not cover prepared food, soft drinks, or dietary supplements. If a restaurant heats your meal, serves it with utensils, or combines ingredients for you, the full 9.8% applies.5Washington State Legislature. RCW 82.08.0293 – Exemptions, Sales of Food and Food Ingredients
Drugs dispensed under a valid prescription are exempt.6Washington State Legislature. RCW 82.08.0281 – Exemptions, Sales of Prescription Drugs So are family planning drugs and devices (whether prescribed or supplied through a state-contracted family planning clinic) and prosthetic devices that are prescribed, fitted, or furnished by a licensed professional, along with repair parts and related labor.
The Rate Follows the Delivery Address
Washington uses destination-based sourcing. The sales tax rate on any sale is set by where the buyer receives the goods or services, not where the seller is located.7Washington State Legislature. RCW 82.32.730 – Sourcing of Retail Sales
Walk into an Olympia store and carry an item out, and you pay Olympia’s 9.8%. Have the same store ship it to a Tacoma address, and the Tacoma rate applies instead. For businesses sending orders across multiple cities, the DOR’s tax rate lookup tool is the standard way to find the right rate for each delivery address. Charge the wrong one and you’ll either face a complaint from the customer or owe the shortfall out of pocket.
Use Tax on Untaxed Online or Out-of-State Purchases
If you buy something from a seller that doesn’t collect Washington sales tax, you owe use tax at the same rate instead. For Olympia residents, that’s 9.8% on items used or stored in the city.8Washington Department of Revenue. Use Tax
Common triggers include buying furniture from a smaller out-of-state website, picking up equipment from a private party, or bringing goods into Washington from another state. Most large online retailers now collect Washington sales tax automatically, so the gap mostly shows up with private sellers and smaller merchants. You report and pay use tax through the DOR’s My DOR portal or by mailing a Consumer Use Tax Return.
Marketplaces handle this on their own: Washington law makes platforms like Amazon, eBay, and Etsy collect and remit sales tax on taxable sales they facilitate for third-party sellers.9Cornell Law Institute. Washington Administrative Code 458-20-282 – Marketplace Tax Collection If you buy through one of those sites, the tax is already built into checkout.
If You’re a Business Collecting the Tax
Any business making retail sales in Olympia needs a Washington state business license, which comes with a nine-digit Unified Business Identifier (UBI) number used as your tax account identifier.10Washington Department of Revenue. Business Licensing and Renewals FAQs Out-of-state sellers must register once their combined gross receipts sourced to Washington cross $100,000 in the current or prior year.11Washington Department of Revenue. Out of State Businesses Reporting Thresholds and Nexus
Returns are filed electronically through My DOR. The DOR assigns each business a monthly, quarterly, or annual filing frequency based on expected tax liability, and returns are generally due by the 25th day of the month following the reporting period.12Washington State Legislature. RCW 82.32.045 – Time and Place of Payment, Penalties Keep sales tax records (invoices, receipts, exemption certificates) for at least five years; without them, you lose the right to challenge any DOR assessment covering the missing period.13Washington State Legislature. WAC 458-20-254 – Recordkeeping