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Writer's pictureGreater Issaquah Chamber of Commerce

State Wastes No Time Increasing B&O Taxes


Senate Bill 6492 was fast tracked through the legislative process and it was signed into law earlier this month. The measure, which passed the state House on a 52-45 vote on February 6, addresses problems created by a bill from the 2019 legislative session. The bill from last year established an entitlement for workforce education through a new B&O tax surcharge on businesses providing certain services. The tax collections go to the Workforce Education Investment Account. Unfortunately, the bill was poorly written and difficult to administer. While the new legislation will bring the B&O tax rate for the smallest businesses back to where it was before the increase last year, it's still a major tax increase that will be felt by many employers and our economy. According to the Department of Revenue, the legislation will expand the tax increase to more than 4,000 new businesses. In total, an estimated 14,000 businesses that employ around 886,000 people will see an increase. This tax increase will make things like health care and home building more expensive, compounding existing challenges in our state. We know that new costs placed on various professions will be passed along to consumers -- making life less affordable.

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