The bill introduces a new section to chapter 67.28 RCW, allowing local governments, including counties, cities, and towns, to impose a special excise tax on short-term rental lodging. This tax can be set at a rate not exceeding 10 percent and is applicable to rentals facilitated through short-term rental platforms. Local governments are required to adopt a resolution of intent before imposing the tax, and the revenues generated must be used exclusively for affordable housing programs, including homeless assistance and temporary shelters. Additionally, local governments may exempt one short-term rental property per operator based on specific criteria related to age and income.

The bill also amends existing laws, specifically RCW 67.28.181 and RCW 82.14.410, to clarify tax rates and exemptions. Notably, it updates the population thresholds for certain municipalities and adjusts the maximum tax rates that can be imposed. The amendments ensure that the new excise tax on short-term rentals is not included in the calculation of the effective combined tax rate, thereby allowing local governments to impose this new tax without exceeding existing limits on lodging taxes.

Statutes affected:
Original Bill: 64.37.010, 82.14.410
Substitute Bill: 64.37.010, 82.14.410
Engrossed Substitute: 64.37.010, 82.14.410