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Committee hears bill to clarify B&O exemption for newspapers and certain digital content
Summary
The House Finance Committee heard testimony on Senate Bill 5458, which would clarify how newspaper publishers and certain digital-content publishers qualify for a business-and-occupation (B&O) tax exemption and specify a reversionary B&O rate of 0.484% if the exemption is not claimed.
The House Finance Committee heard testimony on Senate Bill 5458 on March 18, a measure that clarifies how publishers of newspapers and certain digital content should apply the state business-and-occupation (B&O) tax and the reporting requirements tied to a current exemption.
Committee staff said the bill is a companion to House Bill 1060, which this committee previously moved out of the House. Rochelle Harris, committee staff, summarized the policy: "Recipients of certain tax preferences must file an annual report with the Department of Revenue. . . . A B&O exemption is available for amounts received from printing and publishing newspapers, as well as publication of certain digital content." Harris said the current exemption expires January 1, 2034, and that the bill clarifies the fallback rate for activities that are not eligible for the exemption.
Senator Noel Frame, speaking as prime sponsor, said the bill "simply puts the tax rate into the statute that we failed to put in when we provided a full exemption," and described the change as a technical clarification to ensure taxpayers and administrators have a clear reversionary rate on the books. Roland Thompson, representing Allied Daily Newspapers of Washington and the Washington Newspaper Publishers Association, told the committee: "When the preference was created 2 years ago for newspapers in this state, there was not a reversionary rate put in. It was a mistake, and this simply puts the reversionary rate of 0.484 back into statute." Steve Ewing of the Department of Revenue said the bill "will help our administration of this tax exemption that supports your local news outlets and will give them some clarity in terms of how they ought to comply with tax laws."
Rochelle Harris noted a fiscal note is available and that Department of Revenue assumes businesses will file the required report on time and expects minimal revenue impact and modest administrative costs. There were no public opponents who testified at the hearing segment recorded in the transcript.
The committee suspended the hearing on SB 5458 after testimony was complete; no committee action or final vote was recorded in the hearing transcript. The measure will remain pending in the committee for future action.
