SB 5801 amends Washington's fuel tax structure to generate revenue for transportation infrastructure. Starting July 1, 2025, it adds a 6-cent-per-gallon tax on regular fuel and a 3-cent tax on special fuel (with an additional 3-cent tax on special fuel beginning July 1, 2027). The bill also mandates annual 2% increases to regular fuel tax rates starting July 1, 2026, and to special fuel rates starting July 1, 2028. These changes directly affect fuel licensees (businesses selling fuel) and will increase costs for consumers purchasing gasoline or special fuels. The legislation repeals outdated tax provisions and establishes new funding mechanisms to support state transportation system development.
SB 5357 modifies the actuarial funding process for several Washington state public pension systems, affecting retirement plans for public employees, teachers, and law enforcement, among others. A key provision updates the long-term economic assumptions used by the state actuary for valuation purposes, effective July 1, 2025. These changes include lowering the assumed inflation rate from 3.5% to 2.75% and the investment rate of return from 8% to 7.25%. The bill also sets specific funding goals for different pension plans and suspends contribution rates for Public Employees' Retirement System Plan 1 and Teachers' Retirement System Plan 1 during the 2025-2027 and 2027-2029 fiscal biennia.
Senate Bill 5794 aims to improve how tax preferences are managed in Washington state. It implements recommendations from the state's tax preference performance review process, which evaluates the effectiveness of existing tax exemptions. The bill eliminates several tax preferences identified as obsolete or unused and clarifies the legislative intent behind others. This includes updating specific tax code sections and modifying effective or expiration dates for certain industries, such as manufacturing of seafood and dairy products.
SB 5813 aims to increase funding for public education, child care, early learning, and higher education by modifying the state's capital gains and estate taxes. Beginning January 1, 2025, an additional excise tax of 2.90 percent will be imposed on an individual's Washington capital gains that exceed $1,000,000. For the estate tax, the bill increases the applicable exclusion amount to $3,000,000 for estates of decedents dying on or after July 1, 2025. It also creates a more progressive rate structure for the estate tax by increasing the top tier rates up to 35 percent, with all revenues dedicated to the education legacy trust account.
House Bill 2077 establishes a new tax on certain vehicle manufacturers. This tax applies to profits generated from surplus zero-emission vehicle (ZEV) credits, which are earned when a manufacturer exceeds the state's ZEV sales requirements. The bill requires the Department of Ecology to share manufacturers' ZEV credit activity with the Department of Revenue, and manufacturers must report the prices of ZEV credit transactions. The collected tax revenue is intended to be reinvested into programs that further promote cleaner vehicles.
HB 2061 establishes a new concession fee for duty-free sales enterprises operating within Washington state. These businesses will pay a fee equal to 0.10 (10%) of their gross proceeds from merchandise sales. The revenue collected from this fee will be split, with half directed to the statewide tourism marketing account and the other half deposited into a new sustainable aviation fuel account. The sustainable aviation fuel account is designated to support research, development, and infrastructure for sustainable aviation fuel.
HB 2049 aims to enhance funding for K-12 education and communities by modifying state and local property tax authority and adjusting the school funding formula. The bill revises the maximum dollar amount school districts can levy for enrichment, setting it as the lesser of $2.50 per $1,000 of assessed value or a per-pupil limit. This per-pupil limit is updated with specific "inflation enhancements" through 2030 and establishes a new base amount starting in 2031, impacting funding based on student enrollment. Additionally, it adjusts how the state provides local effort assistance funding to supplement these school district enrichment levies.
Senate Bill 5814 modernizes Washington's tax code by extending the state retail sales tax to select services, such as certain computer-related and digital automated services. It also expands the application of excise taxes on tobacco products to include new and emerging nicotine products. Additionally, the bill requires certain large businesses to make a one-time prepayment of state sales tax collections. These changes affect businesses providing the newly taxed services and nicotine products, as well as the consumers of these items. The revenue generated is intended to support public schools, health care, and social services across the state.
HB 2047 phases out the Washington employee ownership program. It shortens the period during which businesses can earn tax credits for converting to worker-owned cooperatives, employee ownership trusts, or employee stock ownership plans, moving the deadline for earning credits from June 30, 2029, to June 30, 2025. The bill also makes the program's activities, such as providing technical support and referrals, contingent upon specific funding appropriations. The tax credit provisions are set to expire earlier, effectively eliminating these incentives for businesses.
HB 1498 establishes a grant program to help cities and counties create and operate domestic violence co-responder programs. These programs deploy domestic violence victim advocates alongside law enforcement to provide on-scene support, resources, and care navigation for victims and their families. The bill creates a dedicated state treasury account, funded primarily by an additional $100 fee on marriage licenses, to support this initiative. The Office of Crime Victims Advocacy will administer these grants, also providing technical assistance and support for billing health insurance for services.
