Sen. Mark Schoesler (R–Ritzville) sponsored SB 5589 preempting cities from imposing employee-based taxes. The bill has an effective date of January 1, 2019. Any tax that is imposed after that date based on employee wages, hours, or number of positions would be prohibited.

A number of cities currently have business taxes or license fees based on employee hours or numbers of employees. Those cities have successfully worked with their local employers to use these types of classifications in determining how to impose business taxes to help fund the service impacts of large employers in their communities.

While this bill doesn’t impact those approaches already in place, AWC opposes the preemption on local taxing authority because it would restrict cities from having those options in the future.

Dates to remember

The bill is scheduled for a public hearing before the Senate Local Government Committee at 8 am on February 12.