B&O surcharge hospital exemption achieved

February 13, 2020

Though the 2020 legislative session is about halfway through, it appears WSHA has already obtained success in its legislative priority to protect hospitals from increases to their Business and Occupation (B&O) tax rate. Engrossed Substitute Senate Bill 6492, addressing workforce education investment funding through business and occupation tax reform, passed the House yesterday, after previously being passed in the Senate. SB 6492 replaces House Bill 2158, which passed last session and established a B&O rate surcharge to fund workforce education.

The legislature had to quickly replace HB 2158 due to workability issues. HB 2158 included an exemption from the surcharge rate for hospitals. WSHA worked hard and was successful in ensuring the exemption was maintained in the replacement bill. The bill specifies hospital will pay their existing B&O tax rate, rather than the higher rate specified under the bill.  SB 6492 also preserves the standard B&O rates for unaffiliated smaller entities with taxable income less than $1 million.


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