A legislative bill that would eliminate the sales tax on electric bicycles and gear, crafted to encourage more sustainable transportation, passed out of a key finance committee on Friday in Olympia.
Sponsors contend e-bikes — which are having a documented boom during the pandemic — provide an environmentally friendly and affordable alternative to cars that crowd city streets.
House Bill 1330 would promote e-bike use in Washington by exempting sales and use taxes for new electric bikes, along with up to $200 worth of related equipment, including locks, helmets and lights bought in conjunction with an e-bike. The tax savings would continue until 2027 or until $500,000 in total tax exemptions was reached.
Rep. Sharon Shewmake, D-Bellingham, an avid e-bike user known for cycling to work at the Capitol during legislative sessions, described the bikes as "transformative," for the benefits they offer to the user and the community.
"They really are a car replacement in the way a regular bike isn't," she said.
The bikes have rechargeable batteries and electric motors that power the rider forward, either fully or only to add an extra oomph while pedaling. Shewmake said they provide physical and mental health benefits, and they help relieve Seattle's congested streets.
New rules and standards for e-bikes were passed in 2018 in Washington, classifying them by speed and where they can be used.
Carolyn Eaton, owner of Montlake Bicycle Shop, said she has seen electric bike popularity take off in the last couple of years, with more and more people using them as transportation. She estimates they are now her third highest-selling bike category.
Washington is consistently ranked the top bicycle friendly state in the country by the League of American Bicyclists.
E-bikes typically cost anywhere from $600 to $4,000 depending on quality and purpose, which can add a tax of hundreds of dollars for a customer.
"I would hope that by not having the sales tax, the customer who only has that $1,500 budget, maybe they're able to get something a little bit nicer in that $2,000 price range. Something that's more reliable, more environmentally conscious, in the long term being something they can hold on to for many years," Eaton said.
Speaking in favor of the bill at a Wednesday's House Finance Committee hearing, Tamar Shuhendler, of Washington Bikes, a Seattle advocacy group, said it would open the door for more people to try e-biking.
Unlike conventional bikes, the electric propulsion makes them more usable for people with physical limitations, leading to more nontraditional cyclists such as seniors and those with disabilities. Commuters can haul their groceries home and parents can haul their kids over difficult terrain, Shuhendler said.
Shewmake said the tax exemption could help e-bikes reach potential users that are "reluctant to take the plunge."
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