Washington State ranks 11th highest in the U.S. on the Small Business Survival Index. Washington requires a 2/3 legislative majority in order to raise taxes. The tax system also features a state and local property tax with annual increases subject to statutory limitations and a Business and Occupation Tax based upon gross receipts. Washington State’s tax system features:
No corporate income tax
No unitary tax
No inventory tax
No personal income tax
No tax on interest, dividends or capital gains
A state and local property tax with annual increases subject to statutory limitations
A business and occupation (B&O) tax which is based on gross receipts
Washington State gives an annual B&O tax credit of up to $2 million for high technology businesses performing R&D in advanced computing.
Washington State defers or waives sales and use tax associated with new R&D or pilot scale manufacturing operations, or expanding, renovating or equipping an existing facility to current operation for companies that perform advance computing.
Software designed for a specific need for a single person or group of persons is exempt from property tax in Washington State. Included in the definition is modification of canned computer software.
Washington State’s recently-reformed Workers’ Compensation System is now one of the lowest in cost nationally. The system is based on hours worked rather than wages paid which means tax is not paid on vacation, sick leave or time-off. Additionally, wage increases do not inflate cost, and workers pay 27.6 of the premium.