| Washington State House of Representatives Office of Program Research |
BILL ANALYSIS |
| Finance Committee | |
HB 2544
This analysis was prepared by non-partisan legislative staff for the use of legislative members in
their deliberations. This analysis is not a part of the legislation nor does it constitute a
statement of legislative intent.
Brief Description: Concerning tax exemptions for temporary medical housing provided by health or social welfare organizations.
Sponsors: Representatives Hunter, Orcutt, Ericks, Moeller, Ormsby, McIntire, Kenney and Conway; by request of Department of Revenue.
Brief Summary of Bill |
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Hearing Date: 1/18/08
Staff: Jeff Mitchell (786-7139).
Background:
Retail sales and use taxes are imposed by the state, most cities, and all counties. Retail sales taxes
are imposed on retail sales of most articles of tangible personal property and some services. Use
taxes apply to the value of most tangible personal property and some services when used in this
state, if retail sales taxes were not collected when the property or services were acquired by the
user. Use tax rates are the same as retail sales tax rates. The state tax rate is 6.5 percent. Local tax
rates vary from 0.5 percent to 2.4 percent, depending on the location. The average local tax rate is
2.0, for an average combined state and local tax rate of 8.5 percent.
State and local sales taxes apply to lodging rentals by hotels, motels, rooming houses, private
campgrounds, RV parks, and similar facilities. "Hotel-motel" taxes (also called lodging taxes in
some cases) are special sales taxes on lodging rentals. Some hotel-motel taxes are credited
against the state sales tax rather than being added to rental charges paid by customers. Other
hotel-motel taxes are imposed in addition to ordinary state and local sales taxes and are added to
the amount paid by the customer.
Temporary medical housing facilities provide lodging and related services to patients or their
immediate families while the patient is undergoing medical treatment at a hospital or affiliated
outpatient clinic. If the patient is receiving treatment on an outpatient basis, then both the patient
and the immediate family may obtain lodging at these facilities. If the patient is confined to a
hospital while receiving treatment, the immediate family may reside at the facility on a temporary
basis. Presently, there are believed to be nine establishments that might qualify as a temporary
medical housing facility: three in Seattle, two in Spokane, two in Wenatchee, and one each in
Tacoma and Olympia.
Summary of Bill:
Temporary medical housing provided by a health or social welfare (nonprofit) organization is
exempted from state and local sales taxes and similar charges on lodging. To qualify, the
housing must be provided to the patient or patient's family while the patient is receiving medical
treatment at a hospital licensed in the state of Washington or the patient is recuperating or under
observation following medical treatment at a licensed hospital.
Appropriation: None.
Fiscal Note: Requested.
Effective Date: The bill takes effect July 1, 2008.