Major business tax changes advance in Ways & Means hearing; employers urge targeted exemptions

The Ways & Means Committee held an extended hearing April 23 on substitute House Bill 2,081, a broad revenue package that would raise business and occupation (B&O) rates, add temporary surcharges on very large taxpayers, and increase an advanced computing surcharge tied to workforce investments.

Committee staff summarized the bill as a multi‑part package that raises the base B&O rates for retail, wholesaling and manufacturing (to 0.5%) and increases the rate for the services classification for larger firms. The engrossed substitute includes an additional 0.5 percent surcharge on taxpayers with Washington taxable income above a large threshold (the bill as presented applies the surcharge to income above $250 million, then is set to expire after the near term) and raises the advanced computing surcharge to 7.5 percent with a higher annual cap. The…