Washington expands its definition of retail sales, now subjecting certain services to sales tax starting October 1, 2025.

Washington recently passed legislation that expands the state’s definition of retail sales, which will subject certain services to sales tax. Starting October 1, 2025, businesses will be required to collect sales tax on:

• Advertising services

• Live presentations

• Information technology services

• Custom website development services

• Investigation, security, & armored car services

• Temporary staffing services

• Sales of custom software & customization of prewritten software

Certain exclusions no longer satisfy the state’s definition of digital automated services (DAS). The following services will not be exempt come October 1:

• Services involving primarily human effort

• Live presentations

• Advertising services

• Data processing services.

To learn more about these changes and steps the state is taking, you can read the full update here: https://dor.wa.gov/taxes-rates/retail-sales-tax/services-newly-subject-retail-sales-tax