The bill seeks to clarify the excise tax treatment for title and escrow businesses regarding amounts they receive from clients for remittance to county filing offices for document recording. It addresses recent assessments by the Department of Revenue that imposed sales and use and business and occupation taxes on recording surcharges, which have created financial burdens for small independent companies. In light of a recent court ruling classifying the document recording surcharge as an excise tax, the legislature aims to ensure that these taxes are not applied to the surcharge, thereby providing relief to the affected businesses.

To implement this policy, the bill amends RCW 82.04.050, defining "sale at retail" or "retail sale," and introduces provisions that exempt amounts remitted to county filing offices for document recording from taxation, provided these amounts are separately identified on settlement statements. Additionally, the bill clarifies that charges for certain services, including maintenance for transit equipment and recreational activities, are considered retail sales unless otherwise specified. It also outlines exemptions for transactions involving educational institutions, nonprofit organizations, and specific agricultural sales. The bill establishes that certain existing regulations do not apply and sets an effective date of January 1, 2026.