The bill aims to enhance fiscal resources for students and children by introducing targeted sales tax exemptions for specific educational and enrichment programs. It amends RCW 82.04.050 to clarify the definitions of "sale at retail" and "retail sale," now including exemptions for charges related to before-and-after school care programs and arts and cultural classes provided by nonprofit organizations. These programs must primarily occur outside regular school hours and offer educational or enrichment activities, promoting access to such services without the burden of sales tax. The bill also introduces new definitions for "before-and-after school care programs" and "arts and cultural nonprofit organizations," while excluding certain charges related to athletic or fitness facilities from the definition of retail sales.

Additionally, the bill amends the definition of "sale at retail" and "retail sale" to encompass various digital goods, digital codes, and digital automated services, while specifying exclusions for certain services provided to educational institutions. It clarifies that sales to elementary schools, secondary schools, school districts, or educational service districts are exempt from being classified as retail sales for specific services, including custom software and certain data processing services. The act establishes that the terms "sale at retail" and "retail sale" do not apply to services provided to educational institutions, promoting access to educational resources without sales tax. The act is set to take effect on July 1, 2026, and certain existing laws (RCW 82.32.805 and 82.32.808) will not apply, indicating a significant shift in sales tax application to educational services and digital transactions.

Statutes affected:
Original bill: 82.04.050
Substitute bill: 82.04.050