This bill authorizes counties in Washington State to impose a business and occupation tax aimed at funding essential services such as behavioral health, public safety, transit, and waste management. It addresses the limitations of relying solely on sales and property taxes, which can disproportionately impact lower-income residents. The legislation establishes a framework for counties to levy this tax, including a model ordinance for uniformity and fairness, a minimum small business tax threshold, and a system to prevent multiple taxation. It also sets a maximum tax rate of 0.0020 and outlines requirements for referendums on new or increased taxes, along with guidelines for tax reporting and penalties.

Additionally, the bill introduces new provisions for the allocation and apportionment of gross income for business and occupation taxes, specifying that royalties are allocated to the taxpayer's commercial domicile, while service income is apportioned based on payroll and service income factors. It allows for alternative allocation methods if standard provisions do not accurately reflect a taxpayer's business activity and establishes a burden of proof for such cases. The bill also includes confidentiality measures for tax information, specific allocation rules for printing and publishing activities, and a tax deduction for professional employer organizations. Certain sections of the bill will take effect on January 1, 2027, and others on January 1, 2034, while clarifying that existing laws under RCW 82.32.805 and 82.32.808 do not apply to this act.