Washington enacts sales and use tax and business and occupation tax changes and clarifications, including future tax relief
- Washington’s SB 6346, effective January 1, 2029 (contingent on the new income tax’s validity), will repeal sales tax on certain services, exempt personal hygiene products and diapers from sales tax, and expand B&O tax relief for small businesses.
- Additional legislation, including SB 6113 and SB 6231, brings various sales and use tax clarifications and changes, such as new use taxes on certain services (effective October 1, 2025), elimination of sales tax exemptions (e.g., data center refurbishment as of July 1, 2026), and guidance for penny rounding in cash transactions (effective June 11, 2026).
- Businesses need to track the staggered effective dates of these changes, evaluate eligibility for new exemptions or relief, and be aware of specific rules like the transition period for existing service contracts and sourcing for advertising services.
Source EY
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