Bill would exclude escrow remittances for recording from retail sales tax and B&O tax

House Bill 1115 would exclude amounts that escrow agents remit to county filing offices for statutorily set document recording fees from the definition of retail sale and from the business-and-occupation tax when those charges are separately identified on settlement statements.

The bill’s sponsor, Rep. Mike Tharinger, told the committee the measure is intended to clarify that fees counties set by statute and that escrow agents collect and remit on behalf of buyers or sellers are pass-through items, not taxable retail services. Christina King, staff to the committee, told members that under current law the definition of retail sale includes escrow services and that a fiscal note projects a substantial general-fund revenue decrease if the exemption is enacted.

Title and escrow industry witnesses said the practice across Washington has…