Washington state Senate passes tax break for newspapers

Vote 47-1 in favor of state B&O tax exemption; measure moves to House

Legislation to help support newspaper publishers by exempting them from the state business and occupation (B&O) tax passed the Washington State Senate on a 47-1 vote on March 31.

Senate Bill 5199, sponsored by Sen. Mark Mullet, D-Issaquah, is intended to support local news outlets that have come upon tough economic times.

“I’ve seen local newspapers and media in my district struggle over the past decade, and too many have already had to shut down,” Mullet said in a Washington State Senate Democrats news release. “Local journalists play an essential role to inform the public, hold politicians and government accountable, and make our communities stronger. That role is particularly important at the local level, where incredibly important decisions are made that CNN or Fox News will never cover. We need to make sure our small local newspapers can stay afloat and keep serving the public, and this bill will help.”

Sen. Phil Fortunato, R-Auburn, was the only vote against the measure.

Newspapers currently pay a lower B&O tax rate than most businesses, but that preferential tax rate expires in July of 2024, according to the news release. SB 5199 fully eliminates the B&O tax for newspaper publishers and printers, as recommended by nonpartisan legislative auditors who evaluate the state’s tax preferences, and also eliminates the tax for digital and online news outlets if they had a printed publication as recently as Jan. 1, 2008.

Between 2005 and 2020, Washington state newspapers lost 67% of newsroom employees, according to a report from the U.S. Senate Committee on Commerce, Science and Transportation. The pandemic exacerbated the problem. According to data compiled by the Columbia Journalism Review, at least 43 newspapers in Washington laid off employees in 2020, and 23 suspended printing operations or reduced the number of days they offer a print newspaper.

The bill now goes to the House of Representatives for consideration.