The bill seeks to clarify the excise tax treatment of amounts received by title and escrow businesses for remittance to county filing offices for document recording, addressing recent assessments by the Department of Revenue that have imposed financial burdens on these businesses. It asserts that the document recording surcharge is an excise tax rather than a fee, thereby exempting it from sales and use taxes. To implement this, the bill reenacts and amends RCW 82.04.050, introducing new provisions that specifically exempt amounts remitted for recording documents from being classified as taxable sales, while also updating definitions related to escrow services to ensure clarity in tax obligations.

Additionally, the bill introduces a new section that exempts amounts remitted to county filing offices for document recording from the provisions of chapter 82.04 RCW, provided the remitting party is primarily engaged in escrow agent services, with the remittance amounts clearly identified on settlement documents. It also specifies that certain existing regulations (RCW 82.32.805 and 82.32.808) do not apply to this act and establishes an effective date of January 1, 2026. Overall, the bill aims to protect title and escrow businesses from undue tax burdens while aligning state law with judicial interpretations regarding document recording surcharges.