Legislation proposing a new statewide payroll expense tax is moving forward in the Washington House of Representatives. HB 2100 is scheduled for a hearing in the House Finance Committee and would apply a 5 percent tax on employee compensation above $125,000 per employee.
The proposal closely reflects an earlier bill introduced in the Senate by Senator Rebecca Saldaña (D-37). While the Senate companion has not advanced this session, House consideration continues as Representative Shaun Scott (D-43) convenes discussions with business groups and other stakeholders. These conversations are focused on the potential impacts of the tax and whether adjustments are needed as the bill is evaluated.
Supporters of the measure have framed it as a new revenue option tied to high-wage compensation. Opponents have raised concerns about how the tax could affect employers across multiple sectors, particularly those with higher wage positions or competitive labor markets.
WR has expressed opposition to HB 2100. From WR’s perspective, the proposal would create a significant new cost for employers at a time when businesses are already facing elevated labor, supply, and operating expenses. Retailers, in particular, continue to navigate narrow margins and workforce challenges, and WR argues that additional payroll-related taxes could further strain hiring and investment decisions.
