WA Sales Tax Update — Effective Oct 1, 2025

Starting Oct 1, 2025, more services will be subject to retail sales tax (and retailing B&O).

We already covered Live Presentations and Digital Automated Services (DAS) in earlier posts in detail. Here’s a short overview of what else is changing (with brief descriptions):

• Advertising services → All digital and nondigital services related to the creation, preparation, production, or dissemination of advertisements (e.g. layout, art direction, campaign planning, placement, referrals, search engine marketing, traffic monitoring). Exclusions: web hosting, domain registration; printing or publishing (e.g. newspapers); radio & TV broadcasting; and out-of-home advertising (billboards, transit ads, signage).

• IT services → Help desk, system support, data analytics, tech training, and infrastructure operations now taxable. Also included: consulting, diagnostics, and project management services.

• Custom website development → Building, customizing, or major modifications are taxable, including testing new applications, monitoring site performance, and website optimization services. Not included: web hosting or domain registration.

• Custom software & customization → Tailor-made programs or changes to prewritten software now taxed.

• Investigation & security → Includes private investigators, security guard services, and armored car operations. Also included: background check services and missing person tracing services.

• Temporary staffing → Providing workers (short or long term) to client businesses now taxable.

For more info, see: dor.wa.gov/taxes-rates/retail-sales-tax/services-newly-subject-retail-sales-tax

Reminder: update your contracts, invoices, and pricing before October 1, 2025.