The bill amends various sections of Washington state law concerning transportation resources, particularly focusing on sales and use taxes related to motor vehicles and recreational vessels. It introduces a new 0.5% tax on the retail sale of recreational vessels and establishes a tiered tax structure for car rentals and peer-to-peer car sharing, with revenues directed to the multimodal transportation account. Additionally, an 8% luxury vehicle tax is imposed on motor vehicles valued over $100,000, with a deduction set at $100,000 for fiscal year 2026, adjusted annually. The bill also clarifies definitions related to motor vehicles and recreational vessels, specifies exemptions, and ensures taxes on leased vehicles are collected proportionally with each lease payment.

Furthermore, the bill modifies the fuel tax structure, increasing tax rates by two percent annually starting July 1, 2026, and clarifies the distribution of fuel tax revenues to various transportation-related accounts. It repeals the luxury aircraft tax, increases the aircraft fuel tax from 18 cents to 25 cents per gallon, and raises the aircraft registration fee from $15 to $30, with future adjustments. New accounts are established, including the sustainable aviation fuel account and the Sandy Williams connecting communities program account, aimed at enhancing funding for transportation and environmental initiatives. The bill also introduces a bus and bus facilities grant program, a reduced fee identicard for older drivers, and outlines processes for toll collection and public transportation benefit areas, ultimately aiming to improve the efficiency of tax collection and distribution for transportation funding.

Statutes affected:
Original bill: 82.38.030, 82.08.817, 82.12.818, 82.08.9999, 82.48A.010, 82.48A.020, 70A.205.405
Substitute bill: 82.38.030, 82.08.817, 82.12.818, 82.08.9999, 70A.205.405
Engrossed substitute: 82.38.030, 82.08.817, 82.12.818, 82.08.9999, 70A.205.405, 47.66.130, 46.63.160
Bill as passed Legislature: 82.08.817, 82.12.818, 82.38.030, 82.32.145, 82.42.020, 82.42.090, 47.68.250, 82.48.030, 82.48.080, 70A.205.405, 82.08.9999, 47.66.130, 46.63.160, 36.57A.145, 47.60.860
Session law: 82.08.817, 82.12.818, 82.38.030, 82.32.145, 82.42.020, 82.42.090, 47.68.250, 82.48.030, 82.48.080, 70A.205.405, 82.08.9999, 47.66.130, 46.63.160, 36.57A.145, 47.60.860