- Washington enacted tax legislation with changes to B&O tax rates and new services subject to sales tax.
- B&O rate increases and a broader sales tax base will create more tax obligations for businesses.
- Aprio’s SALT team can help assess the impact of these changes to minimize tax liabilities.
- On May 20, 2025, Governor Bob Ferguson signed three tax bills affecting sales and use tax and B&O taxes.
- HB 2081 increases B&O tax rates effective January 1, 2027, for various business classifications.
- Retailing classification rate will increase to 0.50%.
- Manufacturing and wholesaling classifications rate will increase to 0.50%.
- Services and other activities classification rate will be 2.1% for businesses with $5 million or more in annual Washington source gross receipts starting October 1, 2025.
- A 0.5% tax surcharge applies to certain businesses with over $250 million in taxable income starting January 1, 2026.
- HB 2020 introduces a new B&O tax classification for payment card processing activities with a 3.1% rate effective January 1, 2026.
Source: aprio.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
