The proposed bill establishes a payroll expense tax on large employers in Washington, targeting payroll expenses that exceed the social security wage threshold. Set to begin on July 1, 2026, the tax will be levied at a rate of five percent on excess wages, with employers whose total employee wages were $7,000,000 or less in the previous calendar year exempt from this tax. The revenue generated is intended to support public schools, health care, social services, and other essential programs, aiming to create a more equitable tax system in the state. The bill also outlines compliance requirements for employers, including record-keeping and reporting, and establishes penalties for non-compliance, such as fines and potential property seizure for delinquent taxes.

Additionally, the bill introduces new sections to the Revised Code of Washington (RCW) regarding tax collection, interest, and penalties owed to the employment security department. It specifies that notices to withhold and deliver are continuous until liabilities are satisfied and outlines the process for serving such notices. The bill allows the commissioner to file a warrant for assessment, creating a lien on the employer's property, and prioritizes the department's claims for unpaid taxes over other liens. It also details civil action procedures for collecting delinquent amounts, the handling of uncollectible accounts, and the appeals process for employers disputing assessments. The act, titled the "payroll expense tax act," includes a severability clause to maintain the effectiveness of the remaining provisions if any part is found invalid.