The bill seeks to enhance funding for public services in Washington by revising the business and occupation (B&O) tax structure. It proposes a uniform tax rate of 0.5 percent for various business activities, including extraction, manufacturing, retail sales, and digital goods, while introducing a temporary surcharge of 0.5 percent on large companies with annual revenues exceeding $250 million. Additionally, the bill increases the tax rate on contests of chance from 1.5 percent to 1.8 percent and mandates that a portion of the revenues collected be allocated to the workforce education investment account. The legislation also includes specific amendments to tax rates for industries such as child care and aerospace, with provisions for compliance and reporting requirements.

Moreover, the bill introduces new definitions and provisions related to financial and investment vehicles, clarifying deductions for investment income and establishing a new surcharge for advanced computing businesses. It specifies that investment income is only deductible if it constitutes less than five percent of total worldwide gross income, while also allowing certain nonprofit organizations and investment vehicles to deduct investment income regardless of its incidental nature. The Department of Revenue is tasked with providing guidance on these matters, and the bill outlines penalties for non-compliance. Overall, the legislation aims to create a more equitable tax system while generating necessary funds for essential public services and supporting workforce development initiatives.

Statutes affected:
Original Bill: 82.04.230, 82.04.240, 82.04.250, 82.32.534, 82.32.080, 82.04.270, 82.04.280, 82.04.285, 82.04.290, 82.04.4461, 82.04.2906, 82.04.260, 82.04.29004, 82.04.462
Substitute Bill: 82.04.230, 82.04.240, 82.04.250, 82.32.534, 82.32.080, 82.04.270, 82.04.280, 82.04.285, 82.04.290, 82.04.4461, 82.04.2906, 82.04.260, 82.04.29004, 82.04.462
Engrossed Substitute: 82.04.230, 82.04.240, 82.04.250, 82.32.534, 82.32.080, 82.04.270, 82.04.280, 82.04.285, 82.04.290, 82.04.4461, 82.04.2906, 82.04.260, 82.04.29004, 82.04.462
Bill as Passed Legislature: 82.04.230, 82.04.240, 82.04.250, 82.32.534, 82.32.080, 82.04.270, 82.04.280, 82.04.285, 82.04.290, 82.04.4461, 82.04.2906, 82.04.260, 82.04.29004, 82.04.462
Session Law: 82.04.230, 82.04.240, 82.04.250, 82.32.534, 82.32.080, 82.04.270, 82.04.280, 82.04.285, 82.04.290, 82.04.4461, 82.04.2906, 82.04.260, 82.04.29004, 82.04.462