July 2021

2021 Reviews: Four of seven preferences require action

In 2021, JLARC staff reviewed seven tax preferences as part of its annual reporting cycle. These include preferences for manufacturing, health insurance, and medical cannabis.

The Legislative Auditor recommends action on four preferences

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Legislative Auditor's Recommendation
Extend or eliminate the expiration date (structural purpose)

Commissioners' Recommendation
Available October 2021

Summary

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Video Summary

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Legislative Auditor's Recommendation
Extend and modify

Commissioners' Recommendation
Available October 2021

Summary

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Video Summary

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Legislative Auditor's Recommendation
Review

Commissioners' Recommendation
Available October 2021

Summary

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Video Summary

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Legislative Auditor's Recommendation
Continue

Commissioners' Recommendation
Available October 2021

Summary

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Video Summary

Video link will go here

 

The Legislature already implemented one recommendation during the 2021 session

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Legislative Auditor's Recommendation
Review and consider whether to extend

Commissioners' Recommendation
Available October 2021

Summary

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Video Summary

 

The Legislative Auditor recommends allowing one preference to expire and clarifying the intent of another

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Legislative Auditor's Recommendation
Allow to expire

Commissioners' Recommendation
Available October 2021

Summary

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Video Summary

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Legislative Auditor's Recommendation
Clarify intent

Commissioners' Recommendation
Available October 2021

Summary

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Video Summary

 


The Citizen Commission for Performance Measurement of Tax Preferences also considers preferences based on information provided by the Department of Revenue. View the 2021 expedited preference report here (PDF).

 

 

2021 Tax Preference Performance Reviews

July 2021

Joint Legislative Audit & Review Committee

More about 2021 reviews

Study questions

The Citizen Commission selected the following tax preferences for a performance review by JLARC staff in 2021:

In addition, the Commission will consider the following tax preferences, using an expedited process. The expedited process is primarily based on information published by the Department of Revenue in its most recent statutorily required tax exemption study. View the 2021 Expedited Preference Review.

2021:  Not Subject to Full Review (36 Preferences) RCW Enacted
1 Comprehensive Cancer Centers (Sales and Use Tax) 82.08.808; 82.12.808 2005
2 Organ Procurement (Sales and Use Tax) 82.08.02807; 82.12.02749 2002
3 Organ Procurement (B&O Tax) 82.04.326 2002
4 Ferrosilicon (Sales and Use Tax) 82.04.050(1)(a)(iv); 82.04.190(1)(d) 1986
5 Electricity Purchased by DSI Industry (Public Utility Tax) 82.16.0495 2001
6 Natural Gas Purchased by DSI Customers (Use Tax) 82.12.024 2001
7 Natural Gas Purchases by DSI Industry (B&O Tax) 82.04.447 2001
8 Wax and Ceramic Materials to Create Molds (Sales and Use Tax) 82.08.983; 82.12.983 2010
9 Free Public Hospitals (Sales and Use Tax) 82.08.02795; 82.12.02745 1993
10 Human Body Parts (Sales and Use Tax) 82.08.02806; 82.12.02748 1996
11 Prescription Drug Resellers (B&O Tax) 82.04.272 1998
12 Nebulizers (Sales and Use Tax) 82.08.803; 82.12.803 2004
13 Ostomic Items (Sales and Use Tax) 82.08.804; 82.12.804 2004
14 Comprehensive Cancer Centers (B&O Tax) 82.04.4265 2005
15 Semiconductor Materials Manufacturing After $1 Billion Investment New Jobs Credit (B&O Tax) 82.04.448 2003
16 Semiconductor Materials Manufacturing After $1 Billion Investment Construction Costs (Sales and Use Tax) 82.08.965; 82.12.965 2003
17 Semiconductor Materials Manufacturing After $1 Billion Investment Gases and Chemicals (Sales and Use Tax) 82.08.970; 82.12.970 2003
18 Semiconductor Materials Manufacturing After $1 Billion Investment Machinery and Equipment (Property Tax) 84.36.645 2003
19 Semiconductor Microchip Manufacturing After $1 Billion Investment (B&O Tax) 82.04.426 2003
20 Insurance Guarantee Association Assessments (Insurance Premiums Tax) 48.32.145; 48.32A.125 1976
21 Semiconductor Materials Manufacturing After $1 Billion Investment
Preferential Rate (B&O Tax)
82.04.240(2) 2003
22 Vaccine Association (B&O Tax) 82.04.640 2010
23 Temporary Medical Housing (Sales Tax) 82.08.997 2008
24 Nonprofit Nursing Homes (Property Tax) 84.36.040(1)(d) 1891
25 Fraternal Benefit Societies (Insurance Premiums Tax) 48.36A.010; 48.36A.240 1911
26 Kidney Dialysis, Nursing Homes, and Hospice (B&O Tax) 82.04.4289 1945
27 Ocean Marine Insurance (Insurance Premiums Tax) 48.11.050; 48.11.105; 48.14.020(4) 1947
28 Minor Final Assembly Completed in Washington (B&O Tax) 82.04.4295 1977
29 Insurance Producers, Title Insurance Agents, and Surplus Line Brokers (B&O Tax) 82.04.260(9) 1983
30 Dentistry Prepayments (Insurance Premiums Tax) 48.14.0201(6)(c) 1993
31 Prescription Drug Administration (B&O Tax) 82.04.620 2007
32 Government Payments to Public and Nonprofit Hospitals (B&O Tax) 82.04.4311 2002
33 Nonprofit Medical Research and Training Facilities (Property Tax) 84.36.045 1975
34 Health Maintenance Organizations (B&O Tax) 82.04.322 1993
35 Drug Delivery Systems (Sales and Use Tax) 82.08.935; 82.12.935 2003
36 Emergency Medical Air Transport (Aircraft Fuel Tax) 82.42.030(6) 2003
2021:  Critical Part of the Tax Structure (18 Preferences) RCW Enacted
1 Insulin (Sales and Use Tax) 82.08.985; 82.12.985 2004
2 Basic Health Plan Receipts (Insurance Premiums Tax) 48.14.0201(6)(b) 2005
3 Dietary Supplements (Sales and Use Tax) 82.08.925; 82.12.925 2003
4 Kidney Dialysis Equipment (Sales and Use Tax) 82.08.945; 82.12.945 2003
5 Nonprofit Blood and Tissue Banks (B&O Tax) 82.04.324 1995
6 Nonprofit Blood and Tissue Banks (Sales and Use Tax) 82.08.02805; 82.12.02747 1995
7 Medical Devices (Sales and Use Tax) 82.08.0283; 82.12.0277 1975
8 Medicare Receipts (Insurance Premiums Tax) 48.14.0201(6)(a) 1993
9 Health Insurance by State Pool (Insurance Premiums Tax) 48.14.022 1987
10 Health Insurance Claims (B&O Tax) 82.04.4331 1988
11 Annuities (Insurance Premiums Tax) 48.14.020(1) 1979
12 Natural Gas Surplus Sales (B&O Tax) 82.04.310(3) 2007
13 Title Insurance Premiums (Insurance Premiums Tax) 48.14.020(1) 1947
14 Nonprofit Blood and Tissue Banks (Property Tax) 84.36.035 1971
15 Laundry Services for Nonprofit Health Care Facilities (Sales and Use Tax) 82.04.050(2)(a) 1973
16 Insurance Guaranty Funds (Multiple Taxes) 48.32.130 1976
17 Insurance Premiums (B&O Tax) 82.04.320 1935
18 Fraternal Insurance (B&O Tax) 82.04.370 1935