Gov. Chris Gregoire Tuesday appointed Suzan DelBene to be director of the Washington State Department of Revenue.

DelBene will lead the Department of Revenue as it simplifies the state’s tax system — a priority the Governor listed in her recent executive order to improve the way government serves small business. Washington’s sales tax is made up of a flat state rate of 6.5 percent and local rates, which are spread across 300 sales tax location codes. There are also more than 50 B&O tax classifications, and 39 cities with their own B&O tax rates, exemptions, deductions and thresholds.

“Suzan’s background with both large and small businesses will be an asset as the Department of Revenue works to simplify the tax code and reduce costs for businesses,” said Gregoire. “Suzan knows firsthand how the tax system impacts businesses and possesses the skills and vision to lead the agency through this transformation.”

In addition to simplifying the tax system, the Department of Revenue will increase compliance with the tax code by collecting taxes owed by out-of-state businesses and by offering interest and penalty waivers to businesses that pay back taxes in full by May 31, 2011 and meet other criteria.

“I know how businesses work and what government can do to help lay a strong foundation for the private sector,” said DelBene. “Simplifying the tax code and reducing administrative burdens will save small businesses money and time and let owners and employees focus less on paperwork and more on how to operate in this tough economy. This will help small businesses in all of our communities and improve our entire state’s competitiveness.”

DelBene has spent more than 20 years in the business world. She helped launch drugstore.com and then led a small technology start up. In 2004, she went to work for Microsoft, where she served as a vice president within the Mobile Division, and then consulted with Global Partnerships, a microfinance nonprofit.

She was born in Selma, Alabama. She received her Bachelor of Arts degree from Reed College and then earned an MBA from the University of Washington.

“Cindi Holmstrom has done an outstanding job,” said Gregoire. “Under her leadership, the agency focused on saving taxpayers and businesses money and simplifying payment of taxes with innovative programs like ‘e-file.'”