HB 2528 standardizes how cities and counties under Washington’s Growth Management Act can impose a 0.25% real estate sales tax to fund capital projects. It requires tax revenue to be used exclusively for specific infrastructure like roads, parks, airports, and affordable housing projects, with limits on how much can fund homelessness housing (capped at 25% of funds or $100,000, whichever is greater). Cities must identify these projects in their budget and may need voter approval for new taxes, while ensuring funds align with comprehensive planning requirements. The bill updates existing law to create uniform rules across jurisdictions, replacing inconsistent local approaches.
SB 6231 removes a tax exemption that previously allowed data centers to avoid sales tax on equipment replacements. This directly affects data center operators and tenants who currently benefit from the exemption, ending new applications after July 1, 2026, and requiring existing exemption holders to meet new job creation rules. Specifically, data centers must demonstrate a net increase of 35 family-wage jobs (or 3 per 20,000 sq ft) to maintain their exemption, with the requirement applying to both owners and tenants. All existing exemptions for equipment replacement will expire by July 1, 2048, and no new exemptions can be issued after 2026. The bill aims to generate state revenue by ending this tax preference while tying existing benefits to job growth requirements.
SB 6012 exempts schools (both public and private) from paying Washington's retail sales tax on certain services they purchase for operational use, such as cleaning, repairs, or maintenance. The bill amends state tax law (RCW 82.04.050) to exclude these school-purchased services from the definition of "retail sale," removing the tax obligation for schools. This change directly affects schools by reducing their operational costs for essential services, without altering tax treatment for other businesses. The bill is currently pending in committee after being prefaced for introduction in January 2026.
HB 2502 removes sales tax exemptions for certain products and services that currently only exclude state sales tax but not local sales tax. This change will increase revenue for local governments (cities and counties) by requiring these items to pay both state and local sales taxes. The bill specifically targets exemptions listed in the tax code that previously allowed businesses to avoid paying local taxes on qualifying purchases. As a result, local governments will gain additional funding to support essential services like roads, public safety, and community programs.
HB 2292 changes Washington state tax rules to include gains from federally designated small business stock in state capital gains calculations. It affects Washington residents who sell qualifying small business stock after January 1, 2026, by requiring these gains to be taxed under state law. The bill adds these gains to Washington’s adjusted capital gain calculation, which previously excluded them. This means more small business investment profits will now be subject to Washington’s capital gains tax starting in 2026.
HB 2707 ends a tax exemption for drug wholesalers and retailers that warehouse and resell prescription drugs, requiring them to pay a 0.5% tax on their gross income starting January 1, 2027. The bill directly affects businesses registered with the federal Drug Enforcement Administration and licensed by Washington’s Pharmacy Quality Assurance Commission. It repeals the existing tax exemption (RCW 82.04.272) and adds the activity to the state’s taxable business list under RCW 82.04.280. The change aims to generate revenue for state services by updating outdated tax preferences.
HB 2583 amends Washington state law to clarify and limit local governments' authority to impose excise taxes on lodging. It sets specific rate caps: the combined lodging tax rate (including all local taxes) cannot exceed 12% for most areas, or 15.2% for large cities in populous counties. The bill grandfathered existing higher tax rates for municipalities that had them before 1997 or 1998, while prohibiting new taxes in counties with pre-existing rates above 4%. It also allows public facilities districts to impose a separate 2% lodging tax, but only for public facilities and with voter approval if not previously collected. This directly affects cities, counties, and public facilities districts seeking to levy or adjust lodging taxes.
SB 6149 updates Washington state's definition of "rural county" to determine eligibility for a dedicated sales tax funding public facilities. A county qualifies as rural if it has fewer than 100 people per square mile, lacks any city over 45,000 residents, or is smaller than 225 square miles. Rural counties can then impose a sales tax (up to 0.09%, or 0.04% for certain counties) to fund public facilities supporting job creation, affordable workforce housing, or economic development offices. Funds must be used for specific projects listed in economic development plans and reported annually to ensure alignment with job growth and housing goals.
HB 2487 corrects a court interpretation that allowed non-insurers (like pharmacy benefit managers) to wrongly avoid business and occupation taxes by misusing an insurance tax exemption. The bill rewrites the exemption language to require businesses claiming it to prove they paid premium taxes to the state, aligning with the original 1935 intent to prevent double taxation on insurers. It consolidates two tax exemption sections and applies retroactively to tax periods starting October 2, 2019, to ensure businesses that previously misused the exemption pay what they owe. This directly affects insurers and businesses claiming the exemption, aiming to protect state revenue for schools and services.
HB 2335 would repeal tax increases on businesses enacted in 2025, specifically targeting provisions from 2025 Chapter 420. It removes a surcharge on businesses with over $250 million in taxable income (RCW 82.04.288) and eliminates an "Advanced Computing Surcharge," along with 13 other tax provisions from the 2025 law. These changes would directly affect high-grossing businesses and financial institutions subject to the repealed tax rates. The bill takes effect April 1, 2026, reversing specific tax increases implemented by the 2025 legislature.
