This bill establishes a sales and use tax exemption for qualifying farm machinery and equipment aimed at supporting small and medium-sized agricultural producers in Washington State with an annual gross income of less than $2,000,000. The exemption applies to farm equipment valued at $10,000 or more that is used directly for crop production. Eligible farmers must provide an exemption certificate to the seller and maintain records for verification. The bill defines "farm equipment" and sets a "farm income threshold" of $2,000,000, which will be adjusted for inflation by December 2030. The exemption can only be claimed once per calendar year by an eligible farmer.

Additionally, the bill includes provisions for the evaluation of the tax preferences created by this act, requiring a review by the joint legislative audit and review committee by January 1, 2034, to assess the fiscal impact and changes in the number of small and medium-sized agricultural producers. The act is set to take effect on October 1, 2025, and will expire on October 1, 2035.