This bill establishes a sales and use tax exemption for critical access hospitals in Washington State, specifically for the purchase and use of medical equipment and supplies. Starting January 1, 2026, the tax imposed by RCW 82.08.020 will not apply to these sales, although the exemption will not cover construction materials, office equipment, building equipment, administrative supplies, or vehicles not used for patient transportation. The bill defines "critical access hospital" and outlines what constitutes "medical equipment" and "medical supplies." The exemption is set to expire on January 1, 2036.

Additionally, the bill includes a new section in chapter 82.12 RCW, which states that beginning January 1, 2026, the use of medical equipment and supplies by critical access hospitals will also be exempt from this chapter. The definitions and conditions from the first section apply here as well, and this section will also expire on January 1, 2036. The bill further includes a tax preference performance statement, indicating the legislature's intent to provide tax relief to these hospitals and outlining the criteria for evaluating the fiscal impact of the tax preference. If the actual fiscal cost does not exceed the estimated cost by more than five percent in the initial three biennia, the legislature intends to extend the expiration date of the tax preference.