title: RCW 82.04.2905

text:
(1) Except as provided in subsection (2) of this section, upon every person engaging within this state in the business of providing child care for periods of less than twenty-four hours, the amount of tax with respect to such business is equal to the gross proceeds derived from such sales multiplied by the rate of 0.484 percent.
(2) Until January 1, 2035, this chapter does not apply to amounts received by a child care provider for the care and supervision for periods of less than 24 hours of children:
(a) Under 13 years of age; or
(b) Under 19 years of age who have a verified special need or are under court supervision as determined by the department of children, youth, and families under chapter 43.216 RCW.
(3) The exemption under subsection (2) of this section applies only to persons primarily engaged in the business of providing child care.
[ 2024 c 195 s 2; 1998 c 312 s 7.]
Notes:
Tax preference performance statement—2024 c 195 s 2: "(1) This section is the tax preference performance statement for the tax preference contained in section 2, chapter 195, Laws of 2024. This performance statement is only intended to be used for subsequent evaluation of the tax preferences. It is not intended to create a private right of action by any party or to be used to determine eligibility for preferential tax treatment.
(2) The legislature categorizes this tax preference as one intended to provide tax relief for certain businesses or individuals, as indicated in RCW 82.32.808(2)(e).
(3) It is the legislature's specific public policy objective to reduce the costs associated with providing child care by expanding the business and occupation tax exemption for child care services to include income derived from the care and education of children up to age 12.
(4) If a review finds a reduction in the cost of providing child care and education, then the legislature intends to extend the expiration date of this tax preference.
(5) In order to obtain the data necessary to perform the review in subsection (4) of this section, the joint legislative audit and review committee may refer to any data collected by the state." [ 2024 c 195 s 1.]
Effective date—2024 c 195: "This act takes effect October 1, 2024." [ 2024 c 195 s 3.]
Effective date—Savings—1998 c 312: See notes following RCW 82.04.332.
PDF
RCW 82.04.2905
Tax on providing day care. (Effective January 1, 2027.)
(1) Except as provided in subsection (2) of this section, upon every person engaging within this state in the business of providing child care for periods of less than twenty-four hours, the amount of tax with respect to such business is equal to the gross proceeds derived from such sales multiplied by the rate of 0.5 percent.
(2) Until January 1, 2035, this chapter does not apply to amounts received by a child care provider for the care and supervision for periods of less than 24 hours of children:
(a) Under 13 years of age; or
(b) Under 19 years of age who have a verified special need or are under court supervision as determined by the department of children, youth, and families under chapter 43.216 RCW.
(3) The exemption under subsection (2) of this section applies only to persons primarily engaged in the business of providing child care.
[ 2025 c 420 s 110; 2024 c 195 s 2; 1998 c 312 s 7.]
Notes:
Effective date—2025 c 420 ss 101-108 and 110-112: See note following RCW 82.04.230.
Tax preference performance statement exemption—Automatic expiration date exemption—Necessity of act—2025 c 420: See notes following RCW 82.04.230.
Tax preference performance statement—2024 c 195 s 2: "(1) This section is the tax preference performance statement for the tax preference contained in section 2, chapter 195, Laws of 2024. This performance statement is only intended to be used for subsequent evaluation of the tax preferences. It is not intended to create a private right of action by any party or to be used to determine eligibility for preferential tax treatment.
(2) The legislature categorizes this tax preference as one intended to provide tax relief for certain businesses or individuals, as indicated in RCW 82.32.808(2)(e).
(3) It is the legislature's specific public policy objective to reduce the costs associated with providing child care by expanding the business and occupation tax exemption for child care services to include income derived from the care and education of children up to age 12.
(4) If a review finds a reduction in the cost of providing child care and education, then the legislature intends to extend the expiration date of this tax preference.
(5) In order to obtain the data necessary to perform the review in subsection (4) of this section, the joint legislative audit and review committee may refer to any data collected by the state." [ 2024 c 195 s 1.]
Effective date—2024 c 195: "This act takes effect October 1, 2024." [ 2024 c 195 s 3.]
Effective date—Savings—1998 c 312: See notes following RCW 82.04.332.

catchline: Tax on providing day care. (Effective until January 1, 2027.)


doc_type: statute

jurisdiction: wa

title: RCW 82.04.2906

text:
(1) Upon every person engaging within this state in the business of providing intensive inpatient or recovery house residential treatment services for chemical dependency, certified by the department of social and health services, for which payment from the United States or any instrumentality thereof or from the state of Washington or any municipal corporation or political subdivision thereof is received as compensation for or to support those services; as to such persons the amount of tax with respect to such business shall be equal to the gross income from such services multiplied by the rate of 0.484 percent.
(2) If the persons described in subsection (1) of this section receive income from sources other than those described in subsection (1) of this section or provide services other than those named in subsection (1) of this section, that income and those services are subject to tax as otherwise provided in this chapter.
[ 2003 c 343 s 1.]
PDF
RCW 82.04.2906
Tax on certain chemical dependency services. (Effective January 1, 2027.)
(1) Upon every person engaging within this state in the business of providing intensive inpatient or recovery house residential treatment services for chemical dependency, certified by the department of social and health services, for which payment from the United States or any instrumentality thereof or from the state of Washington or any municipal corporation or political subdivision thereof is received as compensation for or to support those services; as to such persons the amount of tax with respect to such business shall be equal to the gross income from such services multiplied by the rate of 0.5 percent.
(2) If the persons described in subsection (1) of this section receive income from sources other than those described in subsection (1) of this section or provide services other than those named in subsection (1) of this section, that income and those services are subject to tax as otherwise provided in this chapter.
[ 2025 c 420 s 111; 2003 c 343 s 1.]
Notes:
Effective date—2025 c 420 ss 101-108 and 110-112: See note following RCW 82.04.230.
Tax preference performance statement exemption—Automatic expiration date exemption—Necessity of act—2025 c 420: See notes following RCW 82.04.230.

license: public-domain-government-work

rule_set: Revised Code of Washington

catchline: Tax on certain chemical dependency services. (Effective until January 1, 2027.)

code: rcw

unit: section

court: Washington State Legislature


title: RCW 82.04.2907

text:
(1) Upon every person engaging within this state in the business of receiving income from royalties, the amount of tax with respect to the business is equal to the gross income from royalties multiplied by the rate of 1.5 percent.
(2) For the purposes of this section, "gross income from royalties" means compensation for the use of intangible property, including charges in the nature of royalties, regardless of where the intangible property will be used. For purposes of this subsection, "intangible property" includes copyrights, patents, licenses, franchises, trademarks, trade names, and similar items. "Gross income from royalties" does not include compensation for any natural resource, the licensing of prewritten computer software to the end user, or the licensing of digital goods, digital codes, or digital automated services to the end user as defined in RCW 82.04.190(11).
[ 2021 c 145 s 9; 2015 3rd sp.s. c 5 s 101; 2010 1st sp.s. c 23 s 107; (2010 1st sp.s. c 23 s 106 expired July 1, 2010); 2010 c 111 s 302; 2009 c 535 s 407; 2001 c 320 s 3; 1998 c 331 s 1.]
Notes:
Construction—2017 c 323: See note following RCW 82.08.052.
Effective dates—2015 3rd sp.s. c 5: See note following RCW 82.08.052.
Expiration date—2010 1st sp.s. c 23 ss 106, 901, and 1201: "Sections 106, 901, and 1201 of this act expire July 1, 2010." [ 2010 1st sp.s. c 23 s 1710.]
Effective date—2010 1st sp.s. c 23 ss 107, 601, 602, 702, 902, 1202, and 1401-1405: "Parts VI, VII, and XIV and sections 107, 702, 902, and 1202 of this act are necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and take effect July 1, 2010." [ 2010 1st sp.s. c 23 s 1713.]
Contingency—Application—2010 1st sp.s. c 23 ss 102-112: See notes following RCW 82.04.067.
Findings—Intent—2010 1st sp.s. c 23: See notes following RCW 82.04.220.
Effective date—2010 1st sp.s. c 23: See note following RCW 82.04.4292.
Purpose—Retroactive application—Effective date—2010 c 111: See notes following RCW 82.04.050.
Intent—Construction—2009 c 535: See notes following RCW 82.04.192.
Effective date—2001 c 320: See note following RCW 11.02.005.
Effective date—1998 c 331: "This act takes effect July 1, 1998." [ 1998 c 331 s 3.]

catchline: Tax on royalties.


title: RCW 82.04.2908

text:
(1) Upon every person engaging within this state in the business of providing room and domiciliary care to residents of an assisted living facility licensed under chapter 18.20 RCW, the amount of tax with respect to such business shall be equal to the gross income of the business, multiplied by the rate of 0.275 percent.
(2) For the purposes of this section, "domiciliary care" has the meaning provided in RCW 18.20.020.
[ 2012 c 10 s 70; 2005 c 514 s 302; 2004 c 174 s 1.]
Notes:
Application—2012 c 10: See note following RCW 18.20.010.
Effective date—2005 c 514: See note following RCW 83.100.230.
Part headings not law—Severability—2005 c 514: See notes following RCW 82.12.808.
Effective date—2004 c 174: "This act takes effect July 1, 2004." [ 2004 c 174 s 8.]

catchline: Tax on provision of room and domiciliary care to assisted living facility residents.


title: RCW 82.04.2909

text:
(1) Upon every person who is an aluminum smelter engaging within this state in the business of manufacturing aluminum; as to such persons the amount of tax with respect to such business is, in the case of manufacturers, equal to the value of the product manufactured, or in the case of processors for hire, equal to the gross income of the business, multiplied by the rate of .2904 percent.
(2) Upon every person who is an aluminum smelter engaging within this state in the business of making sales at wholesale of aluminum manufactured by that person, as to such persons the amount of tax with respect to such business is equal to the gross proceeds of sales of the aluminum multiplied by the rate of .2904 percent.
(3) A person reporting under the tax rate provided in this section must file a complete annual tax performance report with the department under RCW 82.32.534.
(4) This section expires January 1, 2027.
[ 2017 c 135 s 12; 2015 3rd sp.s. c 6 s 502; 2011 c 174 s 301. Prior: 2010 1st sp.s. c 2 s 1; 2010 c 114 s 108; 2006 c 182 s 1; 2004 c 24 s 3.]
Notes:
Effective date—2017 c 135: See note following RCW 82.32.534.
Findings—Tax preference performance statement—2015 3rd sp.s. c 6 ss 502-506: "(1) The legislature finds that the aluminum industry in Washington employs over one thousand people. The legislature further finds that average annual wages and benefits for these employment positions exceed one hundred thousand dollars and that each of these employment positions indirectly generates an additional two to three jobs within the state. The legislature further finds that the aluminum industry generates substantial taxes for local jurisdictions. The legislature further finds that the aluminum industry was severely impacted by the global economic recession. The legislature further finds that the London metal exchange, where aluminum is traded as a commodity, is extremely volatile and substantially impacts the profitability of the aluminum industry. The legislature further finds that for the aforementioned reasons, the industry continues to struggle with profitability, putting the continued employment of its Washington workforce in jeopardy.
(2)(a) This subsection is the tax preference performance statement for the aluminum industry tax preferences in RCW 82.04.2909, 82.04.4481, 82.08.805, 82.12.805, and 82.12.022, as amended in this Part V. The performance statement is only intended to be used for subsequent evaluation of the tax preference. It is not intended to create a private right of action by any party or be used to determine eligibility for preferential tax treatment.
(b) The legislature categorizes this tax preference as one intended to accomplish the general purposes indicated in RCW 82.32.808(2) (c) and (d).
(c) It is the legislature's specific public policy objective to promote the preservation of employment positions within the Washington aluminum manufacturing industry as the industry continues to grapple with the lingering effects of the economic recession and the volatility of the London metal exchange.
(d) To measure the effectiveness of the exemption provided in this Part V in achieving the specific public policy objective described in (c) of this subsection, the joint legislative audit and review committee must evaluate the changes in the number of statewide employment positions for the aluminum industry in Washington." [ 2015 3rd sp.s. c 6 s 501.]
Effective dates—2015 3rd sp.s. c 6: See note following RCW 82.04.4266.
Application—Finding—Intent—2010 c 114: See notes following RCW 82.32.534.
Intent—2004 c 24: "The legislature recognizes that the loss of domestic manufacturing jobs has become a national concern. Washington state has lost one out of every six manufacturing jobs since July 2000. The aluminum industry has long been an important component of Washington state's manufacturing base, providing family-wage jobs often in rural communities where unemployment rates are very high. The aluminum industry is electricity intensive and was greatly affected by the dramatic increase in electricity prices which began in 2000 and which continues to affect the Washington economy. Before the energy crisis, aluminum smelters provided about 5,000 direct jobs. Today they provide fewer than 1,000 direct jobs. For every job lost in that industry, almost three additional jobs are estimated to be lost elsewhere in the state's economy. It is the legislature's intent to preserve and restore family-wage jobs by providing tax relief to the state's aluminum industry.
The electric loads of aluminum smelters provide a unique benefit to the infrastructure of the electric power system. Under the transmission tariff of the Bonneville Power Administration, aluminum smelter loads, whether served with federal or nonfederal power, are subject to short-term interruptions that allow a higher import capability on the transmission interconnection between the northwest and California. These stability reserves allow more power to be imported in winter months, reducing the need for additional generation in the northwest, and would be used to prevent a widespread transmission collapse and blackout if there were a failure in the transmission interconnection between California and the northwest. It is the legislature's intent to retain these benefits for the people of the state." [ 2004 c 24 s 1.]
Effective date—2004 c 24: "This act takes effect July 1, 2004." [ 2004 c 24 s 15.]

catchline: Tax on aluminum smelters. (Expires January 1, 2027.)


title: RCW 82.04.293

text:
For purposes of RCW 82.04.290:
(1) A person is engaged in the business of providing qualifying international investment management services, if:
(a) Such person is engaged primarily in the business of providing investment management services;
(b) At least ten percent of the gross income of such person is derived from providing investment management services to any of the following:
(i) Collective investment funds commercially domiciled, as defined in RCW 82.56.010, outside the United States; or
(ii) Collective investment funds with at least ten percent of their investments located outside the United States;
(c) More than twenty-five percent of such person's employees are located in this state; and
(d) Such person is a member of an affiliated group that collectively has:
(i) Ten or more offices located in at least eight foreign countries;
(ii) At least five hundred full-time employees worldwide;
(iii) Worldwide gross revenue of more than four hundred million dollars during the entire current or immediately preceding calendar year; and
(iv) Average assets under management of more than two hundred billion dollars during the entire current or immediately preceding calendar year.
(2) An affiliate of a person engaged in the business of providing qualifying international investment management services is deemed to also be engaged in the business of providing qualifying international investment management services if the affiliate:
(a) Is primarily engaged in providing portfolio management, fund administration, fund distribution, or transfer agent services, or any combination of these activities, to, either directly or indirectly through such affiliate's affiliated group, any of the following:
(i) Collective investment funds commercially domiciled, as defined in RCW 82.56.010, outside the United States; or
(ii) Collective investment funds with at least ten percent of their investments located outside the United States; and
(b) Satisfies the requirement under subsection (1)(c) of this section.
(3) The definitions in this subsection apply throughout this section unless the context clearly requires otherwise.
(a)(i) "Affiliate" and "affiliated" mean a person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with another person.
(ii) For purposes of this subsection (3)(a), "control" means the possession, directly or indirectly, of more than fifty percent of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting shares, by contract, or otherwise.
(b) "Affiliated group" means any group of two or more persons that are all affiliated with each other.
(c) "Collective investment fund" includes:
(i) A mutual fund or other regulated investment company, as defined in section 851(a) of the internal revenue code of 1986, as amended;
(ii) An "investment company," as that term is used in section 3(a) of the investment company act of 1940, as well as any entity that would be an investment company for this purpose but for the exemptions contained in section 3(c) (1) or (11);
(iii) An "employee benefit plan," which includes any plan, trust, commingled employee benefit trust, or custodial arrangement that is subject to the employee retirement income security act of 1974, as amended, 29 U.S.C. Sec. 1001 et seq., or that is described in sections 125, 401, 403, 408, 457, and 501(c)(9) and (17) through (23) of the internal revenue code of 1986, as amended, or a similar plan maintained by a state or local government, or a plan, trust, or custodial arrangement established to self-insure benefits required by federal, state, or local law;
(iv) A fund maintained by a tax-exempt organization, as defined in section 501(c)(3) of the internal revenue code of 1986, as amended, for operating, quasi-endowment, or endowment purposes;
(v) Funds that are established for the benefit of such tax-exempt organizations, such as charitable remainder trusts, charitable lead trusts, charitable annuity trusts, or other similar trusts; or
(vi) Collective investment funds similar to those described in (c)(i) through (v) of this subsection (3) created under the laws of a foreign jurisdiction.
(d) "Investment management services" means managing the collective assets of a collective investment fund by engaging, either directly or indirectly through such person's affiliated group, in all of the following activities: (i) Portfolio management; (ii) fund administration; (iii) fund distribution; and (iv) transfer agent services.
(4) Investments are located outside the United States if the underlying assets in which the investment constitutes a beneficial interest reside or are created, issued or held outside the United States.
(5) If a person engaged in the business of providing international investment management services no longer meets the Washington state employment eligibility requirements under subsection (1)(c) of this section, then an amount equal to the entire economic benefit accruing to the person in the current and immediately prior nine consecutive calendar years, or the consecutive years since July 1, 2019, whichever is less, as a result of the preferential tax rate under RCW 82.04.290(1) is immediately due and payable.
(6) The department must assess interest, but not penalties, on the amounts due under this section. The interest must be assessed at the rate provided for delinquent excise taxes under chapter 82.32 RCW and accrue until the taxes for which a tax preference has been used are repaid.
[ 2019 c 426 s 3; 1997 c 7 s 3; 1995 c 229 s 1.]
Notes:
Findings—Intent—Automatic expiration date and tax preference performance statement exemption—Effective date—2019 c 426 ss 2 and 3: See notes following RCW 82.04.290.
Savings—Effective date—1997 c 7: See notes following RCW 82.04.255.
Effective date—1995 c 229: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and shall take effect July 1, 1995." [ 1995 c 229 s 4.]

catchline: International investment management services—Definitions.


title: RCW 82.04.294

text:
(1) Upon every person engaging within this state in the business of manufacturing solar energy systems using photovoltaic modules or stirling converters, or of manufacturing solar grade silicon, silicon solar wafers, silicon solar cells, thin film solar devices, or compound semiconductor solar wafers to be used exclusively in components of such systems; as to such persons the amount of tax with respect to such business is, in the case of manufacturers, equal to the value of the product manufactured, or in the case of processors for hire, equal to the gross income of the business, multiplied by the rate of 0.275 percent.
(2) Upon every person engaging within this state in the business of making sales at wholesale of solar energy systems using photovoltaic modules or stirling converters, or of solar grade silicon, silicon solar wafers, silicon solar cells, thin film solar devices, or compound semiconductor solar wafers to be used exclusively in components of such systems, manufactured by that person; as to such persons the amount of tax with respect to such business is equal to the gross proceeds of sales of the solar energy systems using photovoltaic modules or stirling converters, or of the solar grade silicon to be used exclusively in components of such systems, multiplied by the rate of 0.275 percent.
(3) Silicon solar wafers, silicon solar cells, thin film solar devices, solar grade silicon, or compound semiconductor solar wafers are "semiconductor materials" for the purposes of RCW 82.08.9651 and 82.12.9651.
(4) The definitions in this subsection apply throughout this section.
(a) "Compound semiconductor solar wafers" means a semiconductor solar wafer composed of elements from two or more different groups of the periodic table.
(b) "Module" means the smallest nondivisible self-contained physical structure housing interconnected photovoltaic cells and providing a single direct current electrical output.
(c) "Photovoltaic cell" means a device that converts light directly into electricity without moving parts.
(d) "Silicon solar cells" means a photovoltaic cell manufactured from a silicon solar wafer.
(e) "Silicon solar wafers" means a silicon wafer manufactured for solar conversion purposes.
(f) "Solar energy system" means any device or combination of devices or elements that rely upon direct sunlight as an energy source for use in the generation of electricity.
(g) "Solar grade silicon" means high-purity silicon used exclusively in components of solar energy systems using photovoltaic modules to capture direct sunlight. "Solar grade silicon" does not include silicon used in semiconductors.
(h) "Stirling converter" means a device that produces electricity by converting heat from a solar source utilizing a stirling engine.
(i) "Thin film solar devices" means a nonparticipating substrate on which various semiconducting materials are deposited to produce a photovoltaic cell that is used to generate electricity.
(5) A person reporting under the tax rate provided in this section must file a complete annual tax performance report with the department under RCW 82.32.534.
(6) This section expires July 1, 2032.
[ 2022 c 172 s 2; 2017 3rd sp.s. c 37 s 403; 2017 3rd sp.s. c 37 s 402; 2013 2nd sp.s. c 13 s 902; 2011 c 179 s 1; 2010 c 114 s 109; 2009 c 469 s 501; 2007 c 54 s 8; 2005 c 301 s 2.]
Notes:
Tax preference performance statement—2025 c 411; 2022 c 172 s 2: "(1) This section is the tax preference performance statement for the tax preference contained in section 2, chapter 172, Laws of 2022. This performance statement is only intended to be used for subsequent evaluation of the tax preference. It is not intended to create a private right of action by any party or be used to determine eligibility for preferential tax treatment.
(2) The legislature categorizes this tax preference as one intended to improve industry competitiveness and to create and retain jobs as indicated in RCW 82.32.808(2) (b) and (c).
(3) It is the legislature's specific public policy objective to maintain and grow jobs in the solar silicon industry. Trade disputes currently threaten employment in this sector. It is the legislature's intent to extend by five years the preferential tax rates for manufacturers and wholesalers of specific solar energy material and parts in order to maintain and grow jobs in the solar silicon industry.
(4) If a review finds that the number of people employed by the solar silicon industry in Washington is the same or more than in 2019, and that at least 60 percent of employees earn $60,000 a year or more, then the legislature intends to extend the expiration date of the tax preference.
(5) In order to obtain the data necessary to perform the review in subsection (4) of this section, the joint legislative audit and review committee may refer to the department of revenue's annual tax performance report data." [ 2025 c 411 s 1; 2022 c 172 s 3.]
Effective date—2022 c 172: "This act takes effect July 1, 2022." [ 2022 c 172 s 4.]
Tax preference performance statement—2025 c 411; 2017 3rd sp.s. c 37 ss 402 and 403: "(1) This section is the tax preference performance statement for the tax preferences contained in sections 402 and 403, chapter 37, Laws of 2017 3rd sp. sess. This performance statement is only intended to be used for subsequent evaluation of the tax preferences. It is not intended to create a private right of action by any party or be used to determine eligibility for preferential tax treatment.
(2) The legislature categorizes these tax preferences as ones intended to improve industry competitiveness and to create and retain jobs as indicated in RCW 82.32.808(2) (b) and (c).
(3) It is the legislature's specific public policy objective to maintain and grow jobs in the solar silicon industry. Trade disputes currently threaten employment in this sector. It is the legislature's intent to extend by 10 years the preferential tax rates for manufacturers and wholesalers of specific solar energy material and parts in order to maintain and grow jobs in the solar silicon industry.
(4) If a review finds that the number of people employed by the solar silicon industry in Washington is the same or more than in 2015, and that at least 60 percent of employees earn $60,000 a year or more, then the legislature intends to extend the expiration date of the tax preference.
(5) In order to obtain the data necessary to perform the review in subsection (4) of this section, the joint legislative audit and review committee may refer to the department of revenue's annual tax preference report data." [ 2025 c 411 s 2; 2017 3rd sp.s. c 37 s 401.]
Effective date—2017 3rd sp.s. c 37 ss 401 and 402: "Sections 401 and 402 of this act are necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and take effect June 30, 2017." [ 2017 3rd sp.s. c 37 s 1403.]
Effective date—2017 3rd sp.s. c 37 ss 101-104, 403, 503, 506, 508, 510, 512, 514, 516, 518, 520, 522, 524, 526, 703, 705, 707, and 801-803: See note following RCW 82.04.2404.
Findings—Intent—2013 2nd sp.s. c 13: "(1) The legislature finds that to attract and maintain clean energy technology manufacturing businesses, a competitive business climate is crucial. The legislature further finds that specific tax preferences can facilitate a positive business climate in Washington. The legislature further finds that businesses in the solar silicon industry have had to reduce employment due to global conditions. Therefore, the legislature intends to extend a preferential business and occupation tax rate to manufacturers and wholesalers of specific solar energy material and parts to maintain and grow jobs in the solar silicon industry.
(2) The joint legislative audit and review committee, as part of its tax preference review process, must assess the actual fiscal impact of this tax preference in relation to the fiscal estimate for the tax preference and assess changes in employment for firms claiming the preferential tax rate." [ 2013 2nd sp.s. c 13 s 901.]
Effective date—2013 2nd sp.s. c 13: See note following RCW 82.04.43393.
Application—Finding—Intent—2010 c 114: See notes following RCW 82.32.534.
Effective date—2009 c 469: See note following RCW 82.08.962.
Severability—2007 c 54: See note following RCW 82.04.050.
Findings—Intent—2005 c 301: "The legislature finds that the welfare of the people of the state of Washington is positively impacted through the encouragement and expansion of key growth industries in the state. The legislature further finds that targeting tax incentives to focus on key growth industries is an important strategy to enhance the state's business climate.
A recent report by the Washington State University energy program recognized the solar electric industry as one of the state's important growth industries. It is of great concern that businesses in this industry have been increasingly expanding and relocating their operations elsewhere. The report indicates that additional incentives for the solar electric industry are needed in recognition of the unique forces and issues involved in business decisions in this industry.
Therefore, the legislature intends to enact comprehensive tax incentives for the solar electric industry that address activities of the manufacture of these products and to encourage these industries to locate in Washington. Tax incentives for the solar electric industry are important in both retention and expansion of existing business and attraction of new businesses, all of which will strengthen this growth industry within our state, will create jobs, and will bring many indirect benefits to the state." [ 2005 c 301 s 1.]
Effective date—2005 c 301: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 2005." [ 2005 c 301 s 6.]

catchline: Tax on manufacturers or wholesalers of solar energy systems. (Expires July 1, 2032.)


title: RCW 82.04.297

text:
(1) The provision of internet access is subject to tax under RCW 82.04.290(2).
(2)(a) Except as provided in (b) of this subsection, "internet" and "internet access" have the same meaning as those terms are defined in the federal internet tax freedom act, Title 47 U.S.C. Sec. 151 note, as existing on July 1, 2009.
(b) "Internet access" does not include telecommunications service purchased, used, or sold by a person that provides a service that enables users to connect to the internet to access content, information, or other services offered over the internet, to the extent such telecommunications service is purchased, used, or sold: (i) To provide such service; or (ii) to otherwise enable users to access content, information, or other services offered over the internet.
(3) Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.
[ 2010 c 111 s 303; 2009 c 535 s 408; 2000 c 103 s 5; 1997 c 304 s 4.]
Notes:
Purpose—Retroactive application—Effective date—2010 c 111: See notes following RCW 82.04.050.
Intent—Construction—2009 c 535: See notes following RCW 82.04.192.
Findings—Severability—Effective date—1997 c 304: See notes following RCW 35.21.717.

catchline: Internet access—Definitions.


title: RCW 82.04.298

text:
(1) The amount of tax with respect to a qualified grocery distribution cooperative's sales of groceries or related goods for resale, excluding items subject to tax under RCW 82.04.260(4), to customer-owners of the grocery distribution cooperative is equal to the gross proceeds of sales of the grocery distribution cooperative multiplied by the rate of one and one-half percent.
(2) A qualified grocery distribution cooperative is allowed a deduction from the gross proceeds of sales of groceries or related goods for resale, excluding items subject to tax under RCW 82.04.260(4), to customer-owners of the grocery distribution cooperative that is equal to the portion of the gross proceeds of sales for resale that represents the actual cost of the merchandise sold by the grocery distribution cooperative to customer-owners.
(3) The definitions in this subsection apply throughout this section unless the context clearly requires otherwise.
(a) "Grocery distribution cooperative" means an entity that sells groceries and related items to customer-owners of the grocery distribution cooperative and has customer-owners, in the aggregate, who own a majority of the outstanding ownership interests of the grocery distribution cooperative or of the entity controlling the grocery distribution cooperative. "Grocery distribution cooperative" includes an entity that controls a grocery distribution cooperative.
(b) "Qualified grocery distribution cooperative" means:
(i) A grocery distribution cooperative that has been determined by a court of record of the state of Washington to be not engaged in wholesaling or making sales at wholesale, within the meaning of RCW 82.04.270 or any similar provision of a municipal ordinance that imposes a tax on gross receipts, gross proceeds of sales, or gross income, with respect to purchases made by customer-owners, and subsequently changes its form of doing business to make sales at wholesale of groceries or related items to its customer-owners; or
(ii) A grocery distribution cooperative that has acquired substantially all of the assets of a grocery distribution cooperative described in (b)(i) of this subsection.
(c) "Customer-owner" means a person who has an ownership interest in a grocery distribution cooperative and purchases groceries and related items at wholesale from that grocery distribution cooperative.
(d) "Controlling" means holding fifty percent or more of the voting interests of an entity and having at least equal power to direct or cause the direction of the management and policies of the entity, whether through the ownership of voting securities, by contract, or otherwise.
[ 2011 c 2 s 204 (Initiative Measure No. 1107, approved November 2, 2010); 2010 1st sp.s. c 23 s 511; 2008 c 49 s 1; 2001 1st sp.s. c 9 s 1.]
Notes:
Findings—Construction—2011 c 2 (Initiative Measure No. 1107): See notes following RCW 82.08.0293.
Effective date—2010 1st sp.s. c 23: See note following RCW 82.04.4292.
Findings—Intent—2010 1st sp.s. c 23: See notes following RCW 82.04.220.
Effective dates—2001 1st sp.s. c 9: "(1) Sections 1, 2, 4, and 8 of this act are necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and take effect immediately [June 11, 2001].
(2) Sections 3 and 5 of this act are necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and take effect July 1, 2001.
(3) Section 6 of this act takes effect July 1, 2003.
(4) Section 7 [of this act] is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 22, 2001." [ 2001 1st sp.s. c 9 s 9.]

catchline: Tax on qualified grocery distribution cooperatives.


title: RCW 82.04.299

text:
(1)(a) Beginning with business activities occurring on or after April 1, 2020, in addition to the taxes imposed under RCW 82.04.290 (2) and (4), a workforce education investment surcharge is imposed on select advanced computing businesses.
(i) Beginning April 1, 2020, through December 31, 2025, the surcharge is equal to the gross income of the business subject to the tax under RCW 82.04.290 (2) and (4), multiplied by the rate of 1.22 percent.
(ii) Beginning January 1, 2026, the surcharge is equal to the gross income of the business subject to the tax under RCW 82.04.290 (2) and (4), multiplied by the rate of 7.5 percent.
(b) Except as provided in (e) of this subsection (1), in no case will the combined surcharge imposed under this subsection (1) paid by all members of an affiliated group be more than $75,000,000 annually, unless 50 percent or more of the worldwide gross revenue of all members of an affiliated group is from the payment of insurance premiums during the immediately preceding calendar year, in which case the combined surcharge imposed under this subsection (1) paid by all members of an affiliated group may be no more than $25,000,000 annually.
(c) For persons subject to the surcharge imposed under this subsection (1) that report under one or more tax classifications, the surcharge applies only to business activities taxed under RCW 82.04.290 (2) and (4).
(d) The surcharge imposed under this subsection (1) must be reported and paid on a quarterly basis in a manner as required by the department. Returns and amounts payable under this subsection (1) are due by the last day of the month immediately following the end of the reporting period covered by the return. All other taxes must be reported and paid as required under RCW 82.32.045.
(e)(i) To aid in the effective administration of the surcharge in this subsection (1), the department may require persons believed to be engaging in advanced computing or affiliated with a person believed to be engaging in advanced computing to disclose whether they are a member of an affiliated group and, if so, to identify all other members of the affiliated group subject to the surcharge.
(ii) If the department establishes, by clear, cogent, and convincing evidence, that one or more members of an affiliated group, with intent to evade the surcharge under this subsection (1), failed to fully comply with this subsection (1)(e), the department must assess against that person, or those persons collectively, a penalty equal to 50 percent of the amount of the total surcharge payable by all members of that affiliated group for the calendar year during which the person or persons failed to fully comply with this subsection (1)(e). The penalty under this subsection (1)(e) is in lieu of and not in addition to the evasion penalty under RCW 82.32.090(7).
(f) For the purposes of this subsection (1) the following definitions apply:
(i) "Advanced computing" means designing or developing computer software or computer hardware, whether directly or contracting with another person, including: Modifications to computer software or computer hardware; cloud computing services; or operating as a marketplace facilitator as defined by RCW 82.08.0531, an online search engine, or online social networking platform;
(ii) "Affiliate" and "affiliated" means a person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with another person;
(iii) "Affiliated group" means a group of two or more persons that are affiliated with each other;
(iv) "Cloud computing services" means on-demand delivery of computing resources, such as networks, servers, storage, applications, and services, over the internet;
(v) "Control" means the possession, directly or indirectly, of more than 50 percent of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting shares, by contract, or otherwise;
(vi) "Premium" has the same meaning as in RCW 48.18.170; and
(vii) "Select advanced computing business" means a person who is a member of an affiliated group with at least one member of the affiliated group engaging in the business of advanced computing, and the affiliated group has worldwide gross revenue of more than $25,000,000,000 during the immediately preceding calendar year. A person who is primarily engaged within this state in the provision of commercial mobile service, as that term is defined in 47 U.S.C. Sec. 332(d)(1), shall not be considered a select advanced computing business. A person who is primarily engaged in this state in the operation and provision of access to transmission facilities and infrastructure that the person owns or leases for the transmission of voice, data, text, sound, and video using wired telecommunications networks shall not be considered a select advanced computing business. A person that is primarily engaged in business as a "financial institution" as defined in RCW 82.04.29004, as that section existed on January 1, 2020, shall not be considered a select advanced computing business. For purposes of this subsection (1)(f)(vii), "primarily" is determined based on gross income of the business.
(2)(a) The workforce education investment surcharge under this section does not apply to:
(i) Any hospital as defined in RCW 70.41.020, including any hospital that comes within the scope of chapter 71.12 RCW if the hospital is also licensed under chapter 70.41 RCW;
(ii) A provider clinic offering primary care, multispecialty and surgical services, including behavioral health services, and any affiliate of the provider clinic if the affiliate is an organization that offers health care services or provides administrative support for a provider clinic, or is an independent practice association or accountable care organization;
(iii) An insurer, as defined in RCW 48.01.050, or any health maintenance organization regulated under chapter 48.46 RCW or health care service contractor regulated under chapter 48.44 RCW, required to report and pay insurance premium taxes to the state pursuant to chapter 48.14, 48.15, or 48.201 RCW, during the same reporting period; or
(iv) A person that is exempt from premium taxes under RCW 48.14.0201(6) during the same reporting period.
(b) The exemptions under this subsection (2) do not apply to amounts received by any member of an affiliated group other than the businesses described in (a) of this subsection.
(c) For purposes of the exemption in (a)(ii) of this subsection:
(i) "Health care services" means services offered by health care providers relating to the prevention, cure, or treatment of illness, injury, or disease.
(ii) "Primary care" means wellness and prevention services and the diagnosis and treatment of health conditions.
(3) Revenues from the surcharge under this section must be deposited directly into the workforce education investment account established in RCW 43.79.195.
(4) Beginning in fiscal year 2028, and each year thereafter, when the number of qualified Washington state applicants exceeds the available enrollments by 100 at computer science engineering degree programs in four-year state universities, then a commensurate number of computer science and engineering degree enrollments at those state universities must be automatically added and funded for the surcharge imposed under this section to accommodate the additional demand.
(5) The department has the authority to determine through an audit or other investigation whether a person is subject to the surcharge imposed in this section.
[ 2026 c 263 s 5; 2026 c 250 s 5. Prior: 2025 c 420 s 301; 2025 c 401 s 5; prior: 2022 c 170 s 1; 2022 c 56 s 4; 2020 c 2 s 4; 2019 c 406 s 74.]
Notes:
Reviser's note: This section was amended by 2026 c 250 s 5 and by 2026 c 263 s 5, each without reference to the other. Both amendments are incorporated in the publication of this section under RCW 1.12.025(2). For rule of construction, see RCW 1.12.025(1).
Retroactive application—2026 c 263 s 5: "Section 5 of this act applies both prospectively and retroactively to January 1, 2022." [ 2026 c 263 s 7.]
Retroactive application—2026 c 250 ss 5 and 6: "Sections 5 and 6 of this act apply both prospectively and retroactively to January 1, 2026." [ 2026 c 250 s 28.]
Findings—Intent—Affect—Final judgment—2026 c 263: See notes following RCW 82.04.320.
Effective date—2025 c 420 ss 114, 201, 301, 401, and 402: See note following RCW 82.32.875.
Tax preference performance statement exemption—Automatic expiration date exemption—Necessity of act—2025 c 420: See notes following RCW 82.04.230.
Intent—Tax preference performance statement exemption—Automatic expiration date exemption—Effective date—2025 c 401: See notes following RCW 82.04.43397.
Tax preference performance statement exemption—Automatic expiration date exemption—2022 c 170: "RCW 82.32.805 and 82.32.808 do apply to this act." [ 2022 c 170 s 2.]
Effective date—2022 c 170: "This act takes effect July 1, 2022." [ 2022 c 170 s 3.]
Retroactive application—2022 c 56 s 4: "Section 4 of this act applies retroactively to January 1, 2020." [ 2022 c 56 s 14.]
Retroactive application—2020 c 2 s 4: "Section 4 of this act applies both prospectively and retroactively to January 1, 2020." [ 2020 c 2 s 8.]
Tax preference performance statement exemption—Automatic expiration date exemption—Effective dates—2020 c 2: See notes following RCW 82.04.290.
Effective date—2019 c 406 s 74: "Section 74 of this act takes effect January 1, 2020." [ 2019 c 406 s 77.]
Findings—Intent—2019 c 406: See note following RCW 43.79.195.
Findings—Short title—2019 c 406: See notes following RCW 28B.92.200.
Findings—2019 c 406: See note following RCW 28B.94.020.
Findings—Intent—2019 c 406: See note following RCW 28C.30.050.
Findings—Intent—2019 c 406: See note following RCW 43.216.135.

catchline: Workforce education investment surcharge.


title: RCW 82.04.301

text:
(1) This chapter does not apply to any person engaging within this state in business as a hospital, as defined in chapter 70.41 RCW, that is owned by a county with a population greater than two million and that is managed by a state university.
(2) This section expires January 1, 2030.
[ 2019 c 451 s 2.]
Notes:
Tax preference performance statement—2019 c 451: "This section is the tax preference performance statement for the tax preference contained in section 2, chapter 451, Laws of 2019. This performance statement is only intended to be used for subsequent evaluation of the tax preference. It is not intended to create a private right of action by any party or be used to determine eligibility for preferential tax treatment.
(1) The legislature categorizes this tax preference as one intended to provide tax relief to certain eligible businesses, as indicated in RCW 82.32.808(2)(e).
(2) The joint legislative audit and review committee is directed to evaluate the role eligible hospitals play as safety net providers, using metrics including but not limited to:
(a) The monetary value of the following services provided by each eligible hospital:
(i) Uncompensated care, by category of health care services; and
(ii) Medicaid and medicare funded treatment, by category of health care services;
(b) Percentage and count of all clients served by each eligible hospital, by category of health care services, who:
(i) Receive uncompensated care; and
(ii) Use medicare or medicaid to pay for treatment; and
(c) Percentage and count of all clients served in all hospitals in Washington who:
(i) Receive uncompensated care from an eligible hospital, by category of health care services;
(ii) Use medicare and medicaid to pay for treatment from an eligible hospital, by category of health care services; and
(iii) Receive uncompensated trauma care from an eligible hospital.
(3) For the purposes of this section, "eligible hospital" means a taxpayer claiming the tax preference provided in section 2, chapter 451, Laws of 2019.
(4) In order to obtain the data necessary to perform the review in this section, the joint legislative audit and review committee may refer to data from the health care authority and the department of health, as well as any other available data sources." [ 2019 c 451 s 1.]
Effective date—2019 c 451: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 2019." [ 2019 c 451 s 3.]

catchline: Exemptions—Certain hospitals. (Expires January 1, 2030.)


title: RCW 82.04.310

text:
(1) This chapter does not apply to any person in respect to a business activity with respect to which tax liability is specifically imposed under the provisions of chapter 82.16 RCW including amounts derived from activities for which a deduction is allowed under RCW 82.16.050. The exemption in this subsection does not apply to sales of natural gas, including compressed natural gas and liquefied natural gas used or sold to manufacture transportation fuel, and renewable natural gas, by a gas distribution business, if such sales are exempt from the tax imposed under chapter 82.16 RCW as provided in RCW 82.16.310.
(2) This chapter does not apply to amounts received by any person for the sale of electrical energy for resale within or outside the state.
(3)(a) This chapter does not apply to amounts received by any person for the sale of natural or manufactured gas in a calendar year if that person sells within the United States a total amount of natural or manufactured gas in that calendar year that is no more than twenty percent of the amount of natural or manufactured gas that it consumes within the United States in the same calendar year.
(b) For purposes of determining whether a person has sold within the United States a total amount of natural or manufactured gas in a calendar year that is no more than twenty percent of the amount of natural or manufactured gas that it consumes within the United States in the same calendar year, the following transfers of gas are not considered to be the sale of natural or manufactured gas:
(i) The transfer of any natural or manufactured gas as a result of the acquisition of another business, through merger or otherwise; or
(ii) The transfer of any natural or manufactured gas accomplished solely to comply with federal regulatory requirements imposed on the pipeline transportation of such gas when it is shipped by a third-party manager of a person's pipeline transportation.
(4) Until January 1, 2031, this chapter does not apply to amounts received by any person in the form of credits against power contracts with the Bonneville power administration, or funds provided by the Bonneville power administration, for the purpose of implementing energy conservation programs or demand-side management programs, so long as the amount that would otherwise be owed under this chapter is used for purposes of low-income ratepayer assistance or weatherization. The funds generated for low-income ratepayer assistance and weatherization under this subsection must be additive to and not supplant any existing funds used by the utility for low-income ratepayer assistance and weatherization.
[ 2021 c 226 s 2; 2019 c 202 s 2; 2014 c 216 s 302; (2010 c 295 s 1 expired June 30, 2015); 2007 c 58 s 1; 2000 c 245 s 2; 1989 c 302 s 202; 1961 c 15 s 82.04.310. Prior: 1959 c 197 s 15; prior: 1945 c 249 s 2, part; 1943 c 156 s 4, part; 1941 c 178 s 6, part; 1939 c 225 s 5, part; 1937 c 227 s 4, part; 1935 c 180 s 11, part; Rem. Supp. 1945 s 8370-11, part.]
Notes:
Tax preference performance statement—2021 c 226: "This section is the tax preference performance statement for the tax preference contained in section 2, chapter 226, Laws of 2021. This performance statement is only intended to be used for subsequent evaluation of the tax preference. It is not intended to create a private right of action by any party or be used to determine eligibility for preferential tax treatment.
(1) The legislature categorizes this tax preference as one intended to induce certain designated behavior by taxpayers, as indicated in RCW 82.32.808(2)(a), and also to create low-income ratepayer tax and utility rate relief under RCW 82.32.808(2)(e).
(2) The legislature's specific public policy objectives are to:
(a) Increase investment in energy efficiency and conservation programs;
(b) Support efforts by utilities to acquire all cost-effective energy conservation and noncarbon-emitting energy resources as required under state law; and
(c) Increase funds dedicated to low-income ratepayer assistance and weatherization in Washington.
(3) To support the objectives in subsection (2) of this section, it is the legislature's intent to make permanent the exemption from business and occupation tax amounts received by utilities in the form of credits against power contracts or received from the Bonneville power administration for energy conservation purposes, if the tax savings are used by utilities for low-income ratepayer assistance or weatherization programs. This exemption will induce utilities to invest funds in energy conservation and efficiency programs, thereby reducing the amount of electric energy that such utilities must either generate or purchase, thereby reducing energy costs to utilities and customers. Further, state laws mandating utilities to acquire energy through both energy conservation and noncarbon-emitting resources can increase the cost of energy to ratepayers. Therefore, it is the legislature's intent that this exemption from the business and occupation tax apply only to the extent the tax amounts that would otherwise be owed on credits or refunds from the Bonneville power administration are used by a utility for low-income ratepayer assistance or weatherization, and that the funds generated for low-income ratepayer assistance or weatherization be additive to any existing funds used by the utility for those purposes.
(4) To measure the effectiveness of the exemption provided in this act in achieving the specific public policy objectives described in subsection (2) of this section, the joint legislative audit and review committee must, at a minimum:
(a) Evaluate the average annual investment in energy conservation projects by Washington state utilities that have power contracts with the Bonneville power administration; and
(b) Evaluate the average additional funds from the tax savings resulting from this act that are dedicated to low-income ratepayer assistance and weatherization by Washington state utilities that have power contracts with the Bonneville power administration." [ 2021 c 226 s 1.]
Effective date—2021 c 226: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 2021." [ 2021 c 226 s 3.]
Automatic expiration date and tax preference performance statement exemption—2019 c 202: See note following RCW 82.16.310.
Effective date—Findings—Tax preference performance statement—2014 c 216: See notes following RCW 82.38.030.
Expiration date—2010 c 295: "This act expires June 30, 2015." [ 2010 c 295 s 2.]
Finding, purpose—1989 c 302: See note following RCW 82.04.120.

catchline: Exemptions—Public utilities—Electrical energy—Natural or manufactured gas.


title: RCW 82.04.311

text:
This chapter does not apply to income received by the tobacco settlement authority under chapter 43.340 RCW.
[ 2002 c 365 s 14.]
Notes:
Effective date—2002 c 365: See RCW 43.340.902.


title: RCW 82.04.315

text:
This chapter shall not apply to the gross receipts of an international banking facility.
As used in this section, an "international banking facility" means a facility represented by a set of asset and liability accounts segregated on the books and records of a commercial bank, the principal office of which is located in this state, and which is incorporated and doing business under the laws of the United States or of this state, a United States branch or agency of a foreign bank, an Edge corporation organized under Section 25(a) of the Federal Reserve Act, 12 United States Code 611-631, or an Agreement corporation having an agreement or undertaking with the Board of Governors of the Federal Reserve System under Section 25 of the Federal Reserve Act, 12 United States Code 601-604 (a), that includes only international banking facility time deposits (as defined in subsection (a)(2) of Section 204.8 of Regulation D (12 C.F.R. Part 204), as promulgated by the Board of Governors of the Federal Reserve System), and international banking facility extensions of credit (as defined in subsection (a)(3) of Section 204.8 of Regulation D).
[ 1982 c 95 s 7.]
Notes:
Effective date—1982 c 95: See note following RCW 30A.42.070.


title: RCW 82.04.317

text:
This chapter does not apply to amounts received by a motor vehicle manufacturer, as defined in RCW 19.118.021, or by a financing subsidiary of such motor vehicle manufacturer which subsidiary is at least fifty percent owned by the manufacturer, from the sale of motor vehicles at wholesale auctions to dealers licensed under chapter 46.70 RCW or dealers licensed by any other state.
[ 1997 c 4 s 1.]
Notes:
Effective date—1997 c 4: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect immediately [March 18, 1997]." [ 1997 c 4 s 2.]

catchline: Exemptions—Motor vehicle sales by manufacturers at wholesale auctions to dealers.


title: RCW 82.04.320

text:
(1) This chapter does not apply to insurance business activity performed by an insurer that is directly subject to the payment of insurance premium taxes in Washington state pursuant to chapter 48.14, 48.15, or 48.201 RCW. Only the person who paid the insurance premium tax can claim this exemption.
(2) This chapter does not apply to gross premiums and prepayments received by a person that is exempt from premium taxes under RCW 48.14.0201(6).
(3) This chapter does not apply to consideration received by an insurer for annuities regulated under chapters 48.23 and 48.24 RCW.
(4) This chapter does not apply to gross premiums received by an assigned risk plan established by an act of the legislature, either directly or indirectly, where premium taxes were paid by a servicing carrier for such assigned risk plan.
(5) For purposes of this section, for periods preceding May 12, 2021, eligible captive insurers as defined in RCW 48.201.020 are deemed, in respect to their insurance business, to have paid a tax under RCW 48.14.020 or 48.201.040 on their receipt of premiums.
(6) Eligible captive insurers affiliated with a public institution of higher education that are exempt from paying a premium tax under RCW 48.201.040 are exempt from the tax imposed by this chapter in respect to their insurance business. For purposes of this subsection (6), the definitions in RCW 48.201.020 apply.
(7) The department must, in consultation with the office of the insurance commissioner, adopt rules, and draft and issue tax guidance, to carry out the purpose and facilitate enforcement of this section.
(8) For the purposes of this section:
(a) "Insurance business" means activities performed by an insurer as defined in RCW 48.01.050 for which insurance premium taxes are paid.
(b) "Insurer" has the same meaning as in RCW 48.01.050 and also includes health maintenance organizations regulated under chapter 48.46 RCW and health care service contractors regulated under chapter 48.44 RCW.
(c) "Person" has the same meaning as in RCW 82.04.030, and includes a surplus line broker who pays premium taxes pursuant to chapter 48.15 RCW.
(d) "Premium" has the same meaning as in RCW 48.18.170.
[ 2026 c 263 s 2; 2021 c 281 s 10; 1961 c 15 s 82.04.320. Prior: 1959 c 197 s 16; prior: 1945 c 249 s 2, part; 1943 c 156 s 4, part; 1941 c 178 s 6, part; 1939 c 225 s 5, part; 1937 c 227 s 4, part; 1935 c 180 s 11, part; Rem. Supp. 1945 s 8370-11, part.]
Notes:
Reviser's note: The tax preference enacted in section 10(5), chapter 281, Laws of 2021 expires January 1, 2032, pursuant to the automatic expiration date established in RCW 82.32.805(1)(a).
Retroactive application—2026 c 263 s 2: "Section 2 of this act applies both prospectively and retroactively to October 2, 2019." [ 2026 c 263 s 6.]
Findings—Intent—2026 c 263: "(1) The legislature finds that unintended tax loopholes adversely impact the state budget and reduce amounts available to fund schools and other essential services.
(2) The legislature further finds that in 1935 the legislature enacted as RCW 82.04.320 a business and occupation tax exemption that applied to "any person in respect to insurance business upon which a tax based on gross premiums is paid to the state." The Washington supreme court, in Armstrong v. State, 61 Wn.2d 116 (1962), unanimously held that the purpose of the exemption was to prevent insurance businesses from paying two state taxes on the same income, not to create a means for noninsurers to avoid paying any state tax. The legislature affirms the sole purpose of this exemption is to prevent double taxation.
(3) The legislature further finds that the business and occupation tax is a tax on the gross receipts of most businesses in the state, subject to specific deductions and exemptions. The tax generally applies at each point of sale in the process of providing a good or service and on sales between affiliated businesses.
(4) The legislature further finds that, in Envolve Pharmacy Solutions, Inc. v. Department of Revenue, 4 Wn.3d 142 (2024), a majority of the Washington supreme court broadly construed the exemption in RCW 82.04.320 to permit pharmacy benefit managers, and likely other businesses that do not earn premium income and do not pay a premium tax, to avoid paying business and occupation tax on amounts they receive from insurance businesses that do pay premium tax, contrary to the purpose of the exemption as construed in Armstrong. The court relied in large part on the legislature's use of passive voice, rather than active voice, when it enacted the exemption in 1935. If left unchecked, the decision in Envolve Pharmacy Solutions, Inc. would create a large and unintended drain on the state's budget.
(5) Therefore, the legislature finds that it is necessary to restore parity between the language used in RCW 82.04.320 and the intended purpose of that business and occupation tax exemption by restating the exemption in active voice. To streamline the administration of the tax as applied to insurers, the legislature intends to consolidate the similar tax exemptions in RCW 82.04.320 and 82.04.322 into a single exemption. The legislature intends the clarification to the exemption in this act to have no impact on any tax obligation for income received by an insurer for the granting of an annuity, in accordance with RCW 48.14.020(1)(a), which states that such income is not a premium for the purpose of the insurance premium tax.
(6) The legislature further finds that on October 2, 2019, the department of revenue issued public guidance in the form of an interim guidance statement that explained, in part, that a person claiming the exemptions in RCW 82.04.320 must show proof that it paid premium tax to the state with respect to the gross income it claims as exempt from business and occupation tax. The supreme court's decision in Envolve Pharmacy Solutions, Inc. forced the department to rescind that guidance.
(7) The legislature intends for section 2 of this act to apply both prospectively and retroactively to tax periods beginning on or after October 2, 2019, the date that the department of revenue issued the interim guidance statement. By applying section 2 of this act retroactively to October 2, 2019, the legislature intends to treat businesses that did not follow the department's guidance equally to those businesses that followed the guidance. The legislature intends that enforcement actions by the department of revenue against persons governed by the exemption under RCW 82.04.322 before the effective date of this section remain valid." [ 2026 c 263 s 1.]
Affect—Final judgment—2026 c 263: "This act does not affect any final judgment, no longer subject to appeal, entered by a court of competent jurisdiction before the effective date of this act." [ 2026 c 263 s 8.]
Application—2021 c 281 ss 8-11: See note following RCW 48.14.095.
Effective date—2021 c 281: See note following RCW 48.201.010.


title: RCW 82.04.321

text:
This chapter does not apply to amounts received by a health care provider for services performed on patients covered by a qualified health plan offered under RCW 41.05.410, including reimbursement from the qualified health plan and any amounts collected from the patient as part of his or her cost-sharing obligation.
[ 2019 c 364 s 9.]
Notes:
Reviser's note: The tax preference enacted in section 9, chapter 364, Laws of 2019 expires January 1, 2032, pursuant to the automatic expiration date established in RCW 82.32.805(1)(a).

catchline: Exemptions—Qualified health plan patients.


title: RCW 82.04.3221

text:
(1) Except as provided in subsection (5) of this section, the department must waive penalties and interest otherwise due under chapter 82.32 RCW, and allow any person who owes delinquent taxes due under this chapter to enter into a three-year repayment schedule for taxes owed, if all of the following conditions are met:
(a) The taxes owed, and any penalties and interest, are for delinquent taxes due under chapter 82.04 RCW as a result of a person taking the exemption under either RCW 82.04.320 or * 82.04.322, or both, on gross income that is not subject to the insurance premiums tax under chapter 48.14 or 48.15 RCW; and
(b) The taxes owed, and any penalties and interest, are for delinquent taxes due on the gross income of the business between October 2, 2019, and March 31, 2026.
(2)(a) The taxpayer must submit a completed application for a penalty and interest waiver, and repayment schedule, under this section in a form and manner prescribed by the department.
(b) An application for a penalty and interest waiver, and repayment schedule, under this section must be submitted to the department on or before December 31, 2026.
(c) The taxpayer must remit full payment in accordance with the repayment schedule issued by the department. If payment is late or incomplete, additional interest and late payment penalties apply.
(3) A waiver of penalties and interest provided by this section does not apply to other delinquent taxes that are not directly related to the exemption under either RCW 82.04.320 or * 82.04.322, or both.
(4) The tax liability for which a penalty and interest waiver, and repayment schedule, is requested under this section is subject to verification by the department as provided in RCW 82.32.050. This section does not preclude the assessment of taxes, penalties, and interest with respect to any amounts determined by the department to have been underpaid for any tax period for which the taxpayer previously received penalty and interest relief under this section.
(5) Penalties for evasion, negligence, and avoidance pursuant to RCW 82.32.090 are not eligible for the penalty and interest waiver under this section.
(6) This section expires January 1, 2029.
[ 2026 c 263 s 4.]
Notes:
*Reviser's note: RCW 82.04.322 was repealed by 2026 c 263 s 3.
Findings—Intent—Affect—Final judgment—2026 c 263: See notes following RCW 82.04.320.

catchline: Penalty and interest waiver—Insurance. (Expires January 1, 2029.)


title: RCW 82.04.323

text:
The taxes imposed by this chapter do not apply to amounts received by the Washington health benefit exchange established under chapter 43.71 RCW.
[ 2022 c 73 s 1; 2013 2nd sp.s. c 6 s 8.]
Notes:
Retroactive application—2013 2nd sp.s. c 6 s 8: "Section 8 of this act applies both prospectively and retroactively." [ 2013 2nd sp.s. c 6 s 10.]

catchline: Exemption—Washington health benefit exchange.


title: RCW 82.04.324

text:
(1) This chapter does not apply to amounts received by a qualifying blood bank, a qualifying tissue bank, or a qualifying blood and tissue bank to the extent the amounts are exempt from federal income tax.
(2) For the purposes of this section:
(a) "Qualifying blood bank" means a blood bank that qualifies as an exempt organization under 26 U.S.C. 501(c)(3) as existing on June 10, 2004, is registered pursuant to 21 C.F.R., part 607 as existing on June 10, 2004, and whose primary business purpose is the collection, preparation, and processing of blood. "Qualifying blood bank" does not include a comprehensive cancer center that is recognized as such by the national cancer institute.
(b) "Qualifying tissue bank" means a tissue bank that qualifies as an exempt organization under 26 U.S.C. 501(c)(3) as existing on June 10, 2004, is registered pursuant to 21 C.F.R., part 1271 as existing on June 10, 2004, and whose primary business purpose is the recovery, processing, storage, labeling, packaging, or distribution of human bone tissue, ligament tissue and similar musculoskeletal tissues, skin tissue, heart valve tissue, or human eye tissue. "Qualifying tissue bank" does not include a comprehensive cancer center that is recognized as such by the national cancer institute.
(c) "Qualifying blood and tissue bank" is a bank that qualifies as an exempt organization under 26 U.S.C. 501(c)(3) as existing on June 10, 2004, is registered pursuant to 21 C.F.R., part 607 and part 1271 as existing on June 10, 2004, and whose primary business purpose is the collection, preparation, and processing of blood, and the recovery, processing, storage, labeling, packaging, or distribution of human bone tissue, ligament tissue and similar musculoskeletal tissues, skin tissue, and heart valve tissue. "Qualifying blood and tissue bank" does not include a comprehensive cancer center that is recognized as such by the national cancer institute.
[ 2004 c 82 s 1; (2013 2nd sp.s. c 13 s 1202 repealed by 2013 2nd sp.s. c 13 s 1907); 1995 2nd sp.s. c 9 s 3.]
Notes:
Intent—2013 2nd sp.s. c 13: "Part XII of this act is intended to allow flexibility for nonprofit organizations where qualifying activities will be provided by more than one organization. It is not the legislature's intent to expand the lines of nontaxable activity. Therefore, the legislature further intends to reassess the changes made in part XII of this act to ensure the actual fiscal impact reasonably conforms with the fiscal estimate provided in the fiscal note for the legislation." [ 2013 2nd sp.s. c 13 s 1201.]
Effective date—2013 2nd sp.s. c 13: See note following RCW 82.04.43393.
Effective date—1995 2nd sp.s. c 9: See note following RCW 84.36.035.

catchline: Exemptions—Qualifying blood, tissue, or blood and tissue banks.


title: RCW 82.04.326

text:
This chapter does not apply to amounts received by a qualified organ procurement organization under 42 U.S.C. Sec. 273(b) in effect as of January 1, 2001, to the extent that the amounts are exempt from federal income tax.
[ 2002 c 113 s 1.]
Notes:
Effective date—2002 c 113: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect immediately [March 22, 2002]." [ 2002 c 113 s 4.]

catchline: Exemptions—Qualified organ procurement organizations.


title: RCW 82.04.327

text:
This chapter does not apply to adult family homes which are licensed as such, or which are specifically exempt from licensing, under rules of the department of social and health services.
[ 1987 1st ex.s. c 4 s 1.]

catchline: Exemptions—Adult family homes.


title: RCW 82.04.330

text:
(1) This chapter does not apply to any farmer in respect to the sale of any agricultural product at wholesale or to any farmer who grows, raises, or produces agricultural products owned by others, such as custom feed operations. This exemption does not apply to any person selling such products at retail or to any person selling manufactured substances or articles. This chapter does not apply to bee pollination services provided to a farmer by an eligible apiarist.
(2) This chapter also does not apply to any persons who participate in the federal conservation reserve program or its successor administered by the United States department of agriculture with respect to land enrolled in that program.
[ 2015 3rd sp.s. c 6 s 1103; 2014 c 140 s 7; 2001 c 118 s 3; 1993 sp.s. c 25 s 305; 1988 c 253 s 2; 1987 c 23 s 4. Prior: 1985 c 414 s 10; 1985 c 148 s 1; 1965 ex.s. c 173 s 7; 1961 c 15 s 82.04.330; prior: 1959 c 197 s 17; prior: 1945 c 249 s 2, part; 1943 c 156 s 4, part; 1941 c 178 s 6, part; 1939 c 225 s 5, part; 1937 c 227 s 4, part; 1935 c 180 s 11, part; Rem. Supp. 1945 s 8370-11, part.]
Notes:
Tax preference performance statement—2015 3rd sp.s. c 6 ss 1102-1106: "This section is the tax preference performance statement for the tax preference contained in this Part XI. This performance statement is only intended to be used for subsequent evaluation of the tax preference. It is not intended to create a private right of action by any party or be used to determine eligibility for preferential tax treatment.
It is the legislature's specific public policy objective to support the honey bee industry and provide tax relief to eligible apiarists. Honey bees pollinate eighty percent of the nation's flowering crops, which include agricultural crops. They are vitally important to agriculture and an integral part of food production. Therefore, the legislature intends to permanently include eligible apiarists within the definition of farmer and define honey bee products as agricultural products so that they may receive the same tax relief as that provided to other sectors of agriculture. Because the legislature intends for the changes in this Part XI to be permanent, they are exempt from the ten-year expiration provision in RCW 82.32.805." [ 2015 3rd sp.s. c 6 s 1101.]
Tax preference intended to be permanent—2015 3rd sp.s. c 6 ss 1102-1106: "The legislature intends for the amendments in this act to be permanent. Therefore, the amendments in Part XI of this act are exempt from the provision in RCW 82.32.805 and 82.32.808." [ 2015 3rd sp.s. c 6 s 1108.]
Effective dates—2015 3rd sp.s. c 6: See note following RCW 82.04.4266.
Severability—Effective dates—Part headings, captions not law—1993 sp.s. c 25: See notes following RCW 82.04.230.
Effective date—1965 ex.s. c 173: See note following RCW 82.04.050.
Deductions—Compensation for receiving, washing, etc., horticultural products for person exempt under RCW 82.04.330—Materials and supplies used: RCW 82.04.4287.

catchline: Exemptions—Sales of agricultural products.


title: RCW 82.04.331

text:
(1) This chapter does not apply to amounts received by a person engaging within this state in the business of: (a) Making wholesale sales to farmers of seed conditioned for use in planting and not packaged for retail sale; or (b) conditioning seed for planting owned by others.
(2) For the purposes of this section, "seed" means seed potatoes and all other "agricultural seed" as defined in RCW 15.49.011. "Seed" does not include "flower seeds" or "vegetable seeds" as defined in RCW 15.49.011, or any other seeds or propagative portions of plants used to grow cannabis, ornamental flowers, or any type of bush, moss, fern, shrub, or tree.
[ 2022 c 16 s 141; 2014 c 140 s 8; 1998 c 170 s 2.]
Notes:
Intent—Finding—2022 c 16: See note following RCW 69.50.101.
Contingent effective dates—1998 c 170: "(1) Sections 1 and 3 of this act take effect only if House Bill No. 2335 fails to become law.
(2) Section 2 of this act takes effect only if House Bill No. 2335 becomes law." [ 1998 c 170 s 5.] House Bill No. 2335 became 1998 c 312.
Effective date—1998 c 170: "This act takes effect July 1, 1998." [ 1998 c 170 s 6.]

catchline: Exemptions—Wholesale sales to farmers of seed for planting, conditioning seed for planting owned by others.


title: RCW 82.04.332

text:
This chapter does not apply to amounts received from buying unprocessed milk, wheat, oats, dry peas, dry beans, lentils, triticale, canola, corn, rye, and barley, but not including any manufactured products thereof, and selling the same at wholesale.
[ 2007 c 131 s 1; 1998 c 312 s 2.]
Notes:
Effective date—1998 c 312: "This act takes effect July 1, 1998." [ 1998 c 312 s 11.]
Savings—1998 c 312: "This act does not affect any existing right acquired or liability or obligation incurred under the sections amended or repealed in this act or under any rule or order adopted under those sections, nor does it affect any proceeding instituted under those sections." [ 1998 c 312 s 10.]

catchline: Exemptions—Buying and selling at wholesale unprocessed milk, wheat, oats, dry peas, dry beans, lentils, triticale, canola, corn, rye, and barley.


title: RCW 82.04.333

text:
In computing tax under this chapter, a person who is a small harvester as defined in RCW 84.33.035 may deduct an amount not to exceed one hundred thousand dollars per tax year from the gross receipts or value of products proceeding or accruing from timber harvested by that person. A deduction under this section may not reduce the amount of tax due to less than zero.
[ 2011 c 101 s 4; 2007 c 48 s 5; 1990 c 141 s 1.]
Notes:
Effective date—2007 c 48: See note following RCW 82.04.260.

catchline: Exemptions—Small harvesters.


title: RCW 82.04.334

text:
This chapter does not apply to any sale of standing timber excluded from the definition of "sale" in RCW 82.45.010(3). The definitions in RCW 82.04.260(12) apply to this section.
[ 2017 c 323 s 502; 2010 1st sp.s. c 23 s 512; 2007 c 48 s 3.]
Notes:
Tax preference performance statement exemption—Automatic expiration date exemption—2017 c 323: See note following RCW 82.04.040.
Effective date—2010 1st sp.s. c 23: See note following RCW 82.04.4292.
Findings—Intent—2010 1st sp.s. c 23: See notes following RCW 82.04.220.
Effective date—2007 c 48: See note following RCW 82.04.260.

catchline: Exemptions—Standing timber.


title: RCW 82.04.335

text:
This chapter shall not apply to any business of any bona fide agricultural fair, if no part of the net earnings therefrom inures to the benefit of any stockholder or member of the association conducting the same: PROVIDED, That any amount paid for admission to any exhibit, grandstand, entertainment, or other feature conducted within the fairgrounds by others shall be taxable under the provisions of this chapter, except as otherwise provided by law.
[ 1965 ex.s. c 145 s 1.]

catchline: Exemptions—Agricultural fairs.


title: RCW 82.04.337

text:
This chapter shall not apply to amounts received by hop growers or dealers for hops which are shipped outside the state of Washington for first use, if those hops have been processed into extract, pellets, or powder in this state. This section does not exempt a processor or warehouser from taxation under this chapter on amounts charged for processing or warehousing.
[ 1987 c 495 s 1.]

catchline: Exemptions—Amounts received by hop growers or dealers for processed hops shipped outside the state.


title: RCW 82.04.338

text:
This chapter does not apply to any nonprofit organization in respect to gross income derived from business activities for a hop commodity commission or hop commodity board created by state statute or created under chapter 15.65 or 15.66 RCW if: (1) The activity is approved by a referendum conducted by the commission or board; (2) the person is specified in information distributed by the commission or board for the referendum as a person who is to conduct the activity; and (3) the referendum is conducted in the manner prescribed by the statutes governing the commission or board for approving assessments or expenditures, or otherwise authorizing or approving activities of the commission or board. As used in this section, "nonprofit organization" means an organization that is exempt from federal income tax under 26 U.S.C. [Sec.] 501(c)(5).
[ 1998 c 200 s 1.]

catchline: Exemptions—Hop commodity commission or hop commodity board business.


title: RCW 82.04.339

text:
This chapter shall not apply to amounts derived by a church that is exempt from property tax under RCW 84.36.020 from the provision of care for children for periods of less than twenty-four hours.
[ 1992 c 81 s 1.]

catchline: Exemptions—Day care provided by churches.


title: RCW 82.04.3395

text:
This chapter does not apply to nonprofit organizations in respect to amounts derived from the provision of child care resource and referral services.
[ 1995 2nd sp.s. c 11 s 3.]
Notes:
Effective date—1995 2nd sp.s. c 11: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and shall take effect July 1, 1995." [ 1995 2nd sp.s. c 11 s 4.]

catchline: Exemptions—Child care resource and referral services by nonprofit organizations.


title: RCW 82.04.340

text:
This chapter shall not apply to any person in respect to the business of conducting boxing contests and sparring or wrestling matches and exhibitions for the conduct of which a license must be secured from the department of licensing.
[ 2000 c 103 s 6; 1988 c 19 s 4; 1961 c 15 s 82.04.340. Prior: 1959 c 197 s 18; prior: 1945 c 249 s 2, part; 1943 c 156 s 4, part; 1941 c 178 s 6, part; 1939 c 225 s 5, part; 1937 c 227 s 4, part; 1935 c 180 s 11, part; Rem. Supp. 1945 s 8370-11, part.]

catchline: Exemptions—Boxing, sparring, or wrestling matches.


title: RCW 82.04.350

text:
Except as provided in RCW 82.04.286(1), this chapter shall not apply to any person in respect to the business of conducting race meets for the conduct of which a license must be secured from the horse racing commission.
[ 2005 c 369 s 7; 1961 c 15 s 82.04.350. Prior: 1959 c 197 s 19; prior: 1945 c 249 s 2, part; 1943 c 156 s 4, part; 1941 c 178 s 6, part; 1939 c 225 s 5, part; 1937 c 227 s 4, part; 1935 c 180 s 11, part; Rem. Supp. 1945 s 8370-11, part.]
Notes:
Findings—Intent—Severability—Effective date—2005 c 369: See notes following RCW 41.05.750.

catchline: Exemptions—Racing.


title: RCW 82.04.355

text:
This chapter does not apply to any funds received in the course of ride sharing or ride sharing for persons with special transportation needs in accordance with RCW 46.74.010.
[ 2021 c 135 s 5; 1999 c 358 s 8; 1979 c 111 s 17.]
Notes:
Reviser's note: The tax preference enacted in section 5, chapter 135, Laws of 2021 expires January 1, 2032, pursuant to the automatic expiration date established in RCW 82.32.805(1)(a).
Effective date—2021 c 135: See note following RCW 46.18.285.
Effective date—1999 c 358 ss 1 and 3-21: See note following RCW 82.04.3651.
Severability—1979 c 111: See note following RCW 46.74.010.

catchline: Exemptions—Ride sharing.


title: RCW 82.04.360

text:
(1) This chapter does not apply to any person in respect to his or her employment in the capacity of an employee or servant as distinguished from that of an independent contractor. For the purposes of this section, the definition of employee includes those persons that are defined in section 3121(d)(3)(B) of the federal internal revenue code of 1986, as amended through January 1, 1991.
(2) Until July 1, 2010, this chapter does not apply to amounts received by an individual from a corporation as compensation for serving as a member of that corporation's board of directors. Beginning on July 1, 2010, such amounts are taxable under RCW 82.04.290(2).
(3) A booth renter is an independent contractor for purposes of this chapter. For purposes of this section, "booth renter" means any person who:
(a) Performs cosmetology, barbering, esthetics, or manicuring services for which a license is required under chapter 18.16 RCW; and
(b) Pays a fee for the use of salon or shop facilities and receives no compensation or other consideration from the owner of the salon or shop for the services performed.
[ 2010 1st sp.s. c 23 s 702; 2010 c 106 s 207. Prior: 1991 c 324 s 19; 1991 c 275 s 2; 1961 c 15 s 82.04.360; prior: 1959 c 197 s 20; prior: 1945 c 249, s 2, part; 1943 c 156 s 4, part; 1941 c 178 s 6, part; 1939 c 225 s 5, part; 1937 c 227 s 4, part; 1935 c 180 s 11, part; Rem. Supp. 1945 s 8370-11, part.]
Notes:
Application—Refunds—2010 1st sp.s. c 23 ss 702 and 1704: "In accordance with Article VIII, section 5 of the state Constitution, sections 702 and 1704 of this act do not authorize refunds of business and occupation tax validly collected before July 1, 2010, on amounts received by an individual from a corporation as compensation for serving as a member of that corporation's board of directors." [ 2010 1st sp.s. c 23 s 1705.]
Intent—Findings—2010 1st sp.s. c 23: "(1) In adopting the state's business and occupation tax, the legislature intended to tax virtually all business activities carried on within the state. See Simpson Inv. Co. v. Dep't of Revenue, 141 Wn.2d 139, 149 (2000). The legislature recognizes that the business and occupation tax applies to all activities engaged in with the object of gain, benefit, or advantage to the taxpayer or to another person or class, directly or indirectly, unless a specific exemption applies.
(2) One of the major business and occupation tax exemptions is provided in RCW 82.04.360 for income earned as an employee or servant as distinguished from income earned as an independent contractor. The legislature's intent in providing this exemption was to exempt employee wages from the business and occupation tax but not to exempt income earned as an independent contractor.
(3) The legislature finds that corporate directors are not employees or servants of the corporation whose board they serve on and therefore are not entitled to a business and occupation tax exemption under RCW 82.04.360. The legislature further finds that there are no business and occupation tax exemptions for compensation received for serving as a member of a corporation's board of directors.
(4) The legislature also finds that there is a widespread misunderstanding among corporate directors that the business and occupation tax does not apply to the compensation they receive for serving as a director of a corporation. It is the legislature's expectation that the department of revenue will take appropriate measures to ensure that corporate directors understand and comply with their business and occupation tax obligations with respect to their director compensation. However, because of the widespread misunderstanding by corporate directors of their liability for business and occupation tax on director compensation, the legislature finds that it is appropriate in this unique situation to provide limited relief against the retroactive assessment of business and occupation taxes on corporate director compensation.
(5) The legislature also reaffirms its intent that all income of all independent contractors is subject to business and occupation tax unless specifically exempt under the Constitution or laws of this state or the United States." [ 2010 1st sp.s. c 23 s 701.]
Effective date—2010 1st sp.s. c 23 ss 107, 601, 602, 702, 902, 1202, and 1401-1405: See note following RCW 82.04.2907.
Retroactive application—2010 1st sp.s. c 23 ss 402 and 702: See note following RCW 82.04.423.
Findings—Intent—2010 1st sp.s. c 23: See notes following RCW 82.04.220.
Effective date—2010 c 106: See note following RCW 35.102.145.
Finding—Intent—1991 c 275: "(1) The legislature finds:
(a) The existing state policy is to exempt employees from the business and occupation tax.
(b) It has been difficult to distinguish, for business and occupation tax purposes, between independent contractors and employees who are in the business of selling life insurance. The tests commonly used by the department of revenue to determine tax status have not successfully differentiated employees from independent contractors when applied to the life insurance industry.
(2) The intent of this act is to apply federal tax law and rules to distinguish between employees and independent contractors for business and occupation tax purposes, solely for the unique business of selling life insurance." [ 1991 c 275 s 1.]
Effective date—1991 c 275: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and shall take effect July 1, 1991." [ 1991 c 275 s 3.]


title: RCW 82.04.363

text:
This chapter does not apply to amounts received by a nonprofit organization from the sale or furnishing of the following items at a camp or conference center conducted on property exempt from property tax under RCW 84.36.030 (1), (2), or (3):
(1) Lodging, conference and meeting rooms, camping facilities, parking, and similar licenses to use real property;
(2) Food and meals;
(3) Books, tapes, and other products, including books and other products that are transferred electronically, that are available exclusively to the participants at the camp, conference, or meeting and are not available to the public at large.
[ 2009 c 535 s 409; 1997 c 388 s 1.]
Notes:
Intent—Construction—2009 c 535: See notes following RCW 82.04.192.
Effective date—1997 c 388: "This act takes effect October 1, 1997." [ 1997 c 388 s 3.]

catchline: Exemptions—Camp or conference center—Items sold or furnished by nonprofit organization.


title: RCW 82.04.3651

text:
(1) This chapter does not apply to amounts received from fund-raising activities by nonprofit organizations, as defined in subsection (2) of this section, and libraries as defined in RCW 27.12.010.
(2) As used in this section, a "nonprofit organization" means:
(a) An organization exempt from tax under section 501(c) (3), (4), or (10) of the federal internal revenue code (26 U.S.C. Sec. 501(c) (3), (4), or (10));
(b) A nonprofit organization that would qualify under (a) of this subsection except that it is not organized as a nonprofit corporation; or
(c) A nonprofit organization that meets all of the following criteria:
(i) The members, stockholders, officers, directors, or trustees of the organization do not receive any part of the organization's gross income, except as payment for services rendered;
(ii) The compensation received by any person for services rendered to the organization does not exceed an amount reasonable under the circumstances; and
(iii) The activities of the organization do not include a substantial amount of political activity, including but not limited to influencing legislation and participation in any campaign on behalf of any candidate for political office.
(3) As used in this section, the term "fund-raising activity" means soliciting or accepting contributions of money or other property or activities involving the anticipated exchange of goods or services for money between the soliciting organization and the organization or person solicited, for the purpose of furthering the goals of the nonprofit organization. "Fund-raising activity" does not include the operation of a regular place of business in which sales are made during regular hours such as a bookstore, thrift shop, restaurant, or similar business or the operation of a regular place of business from which services are provided or performed during regular hours such as the provision of retail, personal, or professional services. The sale of used books, used videos, used sound recordings, or similar used information products in a library, as defined in RCW 27.12.010, is not the operation of a regular place of business for the purposes of this section, if the proceeds of the sales are used to support the library.
[ 2010 c 106 s 208; 1999 c 358 s 3; 1998 c 336 s 2.]
Notes:
Effective date—2010 c 106: See note following RCW 35.102.145.
Effective date—1999 c 358 ss 1 and 3-21: "Sections 1 and 3 through 21 of this act take effect August 1, 1999." [ 1999 c 358 s 22.]
Findings—1998 c 336: "The legislature finds that nonprofit educational, charitable, religious, scientific, and social welfare organizations provide many public benefits to the people of the state of Washington. Therefore, the legislature finds that it is in the best interests of the state of Washington to provide a limited excise tax exemption for fund-raising activities for certain nonprofit organizations." [ 1998 c 336 s 1.]
Sales tax exemptions: RCW 82.08.02573.

catchline: Exemptions—Amounts received by nonprofit organizations for fund-raising activities.


title: RCW 82.04.367

text:
This chapter does not apply to gross income received by nonprofit organizations exempt from federal income tax under section 501(c)(3) of the internal revenue code of 1954, as amended, that:
(1) Are guarantee agencies under the federal guaranteed student loan program or that issue debt to provide or acquire student loans; or
(2) Provide guarantees for student loans made through programs other than the federal guaranteed student loan program.
[ 1998 c 324 s 1; 1987 c 433 s 1.]

catchline: Exemptions—Nonprofit organizations that are guarantee agencies, issue debt, or provide guarantees for student loans.


title: RCW 82.04.368

text:
This chapter does not apply to nonprofit organizations in respect to amounts derived from provision of the following services:
(1) Presenting individual and community credit education programs including credit and debt counseling;
(2) Obtaining creditor cooperation allowing a debtor to repay debt in an orderly manner;
(3) Establishing and administering negotiated repayment programs for debtors; or
(4) Providing advice or assistance to a debtor with regard to subsection (1), (2), or (3) of this section.
[ 1993 c 390 s 1.]

catchline: Exemptions—Nonprofit organizations—Credit and debt services.


title: RCW 82.04.370

text:
This chapter shall not apply to fraternal benefit societies or fraternal fire insurance associations, as described in Title 48 RCW; nor to beneficiary corporations or societies organized under and existing by virtue of Title 24 RCW, if such beneficiary corporations or societies provide in their bylaws for the payment of death benefits. Exemption is limited, however, to gross income from premiums, fees, assessments, dues or other charges directly attributable to the insurance or death benefits provided by such societies, associations, or corporations.
[ 1961 c 293 s 4; 1961 c 15 s 82.04.370. Prior: 1959 c 197 s 21; prior: 1945 c 249 s 2, part; 1943 c 156 s 4, part; 1941 c 178 s 6, part; 1939 c 225 s 5, part; 1937 c 227 s 4, part; 1935 c 180 s 11, part; Rem. Supp. 1945 s 8370-11, part.]

catchline: Exemptions—Certain fraternal and beneficiary organizations.


title: RCW 82.04.380

text:
This chapter shall not apply to the gross sales or the gross income received by corporations which have been incorporated under any act of the congress of the United States of America and whose principal purposes are to furnish volunteer aid to members of the armed forces of the United States and also to carry on a system of national and international relief and to apply the same in mitigating the sufferings caused by pestilence, famine, fire, floods, and other national calamities and to devise and carry on measures for preventing the same.
[ 1961 c 15 s 82.04.380. Prior: 1959 c 197 s 22; prior: 1945 c 249 s 2, part; 1943 c 156 s 4, part; 1941 c 178 s 6, part; 1939 c 225 s 5, part; 1937 c 227 s 4, part; 1935 c 180 s 11, part; Rem. Supp. 1945 s 8370-11, part.]

catchline: Exemptions—Certain corporations furnishing aid and relief.


title: RCW 82.04.385

text:
This chapter shall not apply to income received from the department of social and health services for the cost of care, maintenance, support, and training of persons with developmental disabilities at nonprofit group training homes as defined by chapter 71A.22 RCW or to the business activities of nonprofit organizations from the operation of sheltered workshops. For the purposes of this section, "the operation of sheltered workshops" means performance of business activities of any kind on or off the premises of such nonprofit organizations which are performed for the primary purpose of (1) providing gainful employment or rehabilitation services to persons with disabilities as an interim step in the rehabilitation process for those who cannot be readily absorbed in the competitive labor market or during such time as employment opportunities for them in the competitive labor market do not exist; or (2) providing evaluation and work adjustment services for persons with disabilities.
[ 2020 c 274 s 68. Prior: 1988 c 176 s 915; 1988 c 13 s 1; 1972 ex.s. c 134 s 1; 1970 ex.s. c 81 s 3.]

catchline: Exemptions—Operation of sheltered workshops.