Washington State Sales Tax Changes 2025 – Effective October 1

Executive Summary

Effective on October 1, 2025, Senate Bill 5814 expands the definition of retail sales in relation to Washington state sales tax to include many digital, technology, and staffing services. Professional services such as accounting, legal, engineering, and healthcare remain exempt. Businesses should review their service offerings now to ensure compliance.

What new services does the 2025 Washington State Sales Tax include?

• Advertising services
• Live presentations (e.g., seminars, performances)
• Information technology services
• Custom website development
• Digital delivery methods (e.g., email, portals, video conferencing)
• Investigation, security, and armored car services
• Temporary staffing services
• Custom software and customization of prewritten software

If your business provides services in these categories, you will likely need to begin collecting and remitting sales tax beginning October 1.

Exempt Professional Services

The new law does not apply to most services that rely on professional expertise. Exempt categories include:

• Accounting, auditing, and bookkeeping
• Legal services
• Healthcare-related services
• Engineering and architectural services
• Licensed consulting and financial advisory services
• Certain educational and training programs

If your services fall into these categories, your tax obligations are unlikely to change.

Why These Sales Tax Changes Matter for Washington Businesses

The expansion is not only about charging sales tax—it also means:

• Updating contracts to clarify tax treatment for clients.
• Adjusting invoicing systems to ensure accurate tax collection.
• Communicating with customers who may not expect to pay sales tax on services like digital advertising or IT support.

Preparing now can help avoid compliance issues, unexpected costs, or strained client relationships once the law takes effect.

Next Steps

Every business will experience these changes differently. Now is the time to review your services and prepare for the October deadline.

If you’d like to discuss how these rules may apply to your business, our team at VSH is here to help. Contact us to schedule a consultation.

For official details, visit the Washington State Department of Revenue.