By: Washington Research Council
State business and occupation (B&O) tax collections are up 258% since 2000. But businesses also pay sales, property, and many other state and local taxes. Indeed, businesses paid 49.7% of total state and local taxes in Washington in fiscal year 2022, according to a report from the Council on State Taxation. (Nationally, businesses paid an average of 44.6% of state and local taxes.)
Washington businesses paid $10,100 in state and local taxes per employee. This was the 11th highest amount among the states, and 18.8% above the $8,500 average paid nationally. Meanwhile, according to the Tax Foundation, Washington’s tax competitiveness is the sixth worst in the nation.
Washington businesses face a heavy tax burden compared to businesses in other states. Taxes are not the only factor for businesses deciding where to set up shop, but they are part of the consideration. Washington’s competitiveness will worsen if the business tax burden continues to grow.
