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Bill

HB 1993

Exempting child care providers from the business and occupation tax.

2025-2026 Regular Session Introduced by Rob Chase and 2 co-sponsors

HB 1993 exempts child care providers from Washington's B&O tax, reducing their operating costs but also decreasing state revenue.

First reading, referred to Finance.
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Bill Summary · HB 1993

Legislative bill overview

HB 1993 would exempt child care providers from Washington's Business & Occupation (B&O) tax, a gross receipts tax that currently applies to most business activities in the state. The bill targets providers of child care services specifically, removing their obligation to pay this tax on revenue generated from child care operations.

Why is this important

Child care is a critical infrastructure that enables workforce participation, particularly for lower and middle-income families. B&O tax exemptions directly reduce operating costs for providers, which could translate to lower fees for families, improved provider profitability, or expanded access to care in underserved areas. Conversely, this exemption reduces state tax revenue that funds public services.

Potential points of contention

  • Revenue impact: B&O tax exemptions reduce state General Fund revenue; legislators will debate whether this cost is justified or if funds should come from other sources
  • Scope definition: Questions about which child care providers qualify (licensed only? family providers? religious organizations?) and whether exemptions should be broader or narrower
  • Competitive fairness: Other small businesses may argue they deserve similar tax relief, or debate whether child care deserves preferential treatment over other essential services
  • Program effectiveness: Uncertainty about whether tax savings will meaningfully lower child care costs for families versus increasing provider margins

Compiled from official sources — confirm details with the bill’s official record.

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