Senate Bill Report SB 5799 — Workforce Education Investment Surcharge for Provider Clinics (January 16, 2022)
Summary
This Senate Bill Report on SB 5799, as of January 16, 2022, concerns modifying the application of the workforce education investment surcharge to provider clinics and affiliated organizations, with Senators Robinson and Lovick as sponsors. The Brief Summary says the bill exempts provider clinics and affiliated organizations from the surcharge. The report states that the surcharge is equal to the gross income of the business subject to B&O tax under the Service and Other Activities classification, multiplied by the rate of 1.22 percent, and is capped at $9 million annually. It says the exemption is not subject to the automatic ten-year expiration date or JLARC review, and that the bill takes effect on July 1, 2022.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
- Issuer
- Congressional materials
- Document type
- Report
- Date
- 2022-01-18
- Case
- 2022 01 18 A29483 D237688 Bill Report 5799 Sba Bfst 22
Cite this document
“Senate Bill Report SB 5799 — Workforce Education Investment Surcharge for Provider Clinics (January 16, 2022).”
Original at app.leg.wa.gov, dated 2022-01-18. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2022-01-18-2022-01-18-a29483-d237688-bill-report-5799-sba-bfst-22/
, SHA-256 32bb8a9e633f42c0f95d79682844e5f5879858db1ad513e233950621933ef8f2.Full text
SENATE BILL REPORT
SB 5799
As of January 16, 2022
Title: An act relating to modifying the application of the workforce education investment
surcharge to provider clinics and affiliated organizations.
Brief Description: Modifying the application of the workforce education investment surcharge
to provider clinics and affiliated organizations.
Sponsors: Senators Robinson and Lovick.
Brief History:
Committee Activity: Business, Financial Services & Trade: 1/18/22.
Brief Summary of Bill
• Exempts provider clinics and affiliated organizations from the workforce
education investment surcharge.
SENATE COMMITTEE ON BUSINESS, FINANCIAL SERVICES & TRADE
Staff: Clinton McCarthy (786-7319)
Background: Washington's major business tax is the business and occupation (B&O) tax.
The B&O tax is imposed on the gross receipts of business activities conducted within the
state, without any deduction for the costs of doing business. Businesses must pay the B&O
tax even though they may not have any profits or may be operating at a loss. A taxpayer
may have more than one B&O tax rate, depending on the types of activities conducted.
Major B&O tax rates are 0.471 percent for retailing; 0.484 percent for manufacturing,
wholesaling, and extracting; and 1.5 percent—businesses with taxable income of less than
$1 million or 1.75 percent—businesses with taxable income of $1 million or more for
services and for activities not classified elsewhere. Several preferential rates also apply to
specific business activities.
This analysis was prepared by non-partisan legislative staff for the use of legislative
members in their deliberations. This analysis is not part of the legislation nor does it
constitute a statement of legislative intent.
Senate Bill Report -1- SB 5799
Beginning with business activities occurring on or after April 1, 2020, an additional
workforce education investment surcharge was applied to the amount of tax payable under
the Service and Other Activities B&O tax classification by select advanced computing
businesses. A select advance computing business is a business, or member of an affiliated
group, with at least one member engaged in advanced computing and the affiliated group
has more than $25 billion in worldwide gross income in the immediately preceding calendar
year. The surcharge is equal to the gross income of the business subject to B&O tax under
the Service and Other Activities classification, multiplied by the rate of 1.22 percent. This is
in addition to the Service and Other Activities B&O tax rate of 1.5 percent, for a total of
2.72 percent. The amount of surcharge owed by a business or an affiliated group is capped
at $9 million annually. The surcharge does not apply to hospitals or financial institutions.
Legislation that establishes or expands a tax preference, such as a tax exemption, deduction,
or preferential rate, must include a Tax Preference Performance statement that identifies the
public policy objective of the tax preference, as well as specific metrics that the Joint
Legislative Audit and Review Committee (JLARC) can use to evaluate the effectiveness of
the preference. A new tax preference automatically expires after ten years unless an
alternative expiration date is provided or the tax preference is exempt from the automatic
expiration date in the bill.
Summary of Bill: The following entities are exempt from the workforce education
investment surcharge:
• provider clinics offering primary care, multi-specialty, and surgical services,
including behavioral health services; and
• affiliates of the provider clinic if the affiliate is an organization that offers health care
services or provides administrative support for a provider clinic, or is an independent
practice association or accountable care organization.
The exemption for provider clinics and affiliated entities is not subject to the automatic ten-
year expiration date or JLARC review.
Appropriation: None.
Fiscal Note: Available.
Creates Committee/Commission/Task Force that includes Legislative members: No.
Effective Date: The bill takes effect on July 1, 2022.
Senate Bill Report -2- SB 5799
File and source
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- 2022-01-18_a29483_d237688_bill-report-5799-sba-bfst-22.pdf
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- SHA-256
- 32bb8a9e633f42c0f95d79682844e5f5879858db1ad513e233950621933ef8f2
- Original
- app.leg.wa.gov