ANNOUNCEMENT 21 May 2019
A new law in the state of Washington makes tax benefits for firms providing international investment management services conditional on local employment.
NUMBER OF INTERVENTIONS
On May 21, 2019 the governor of Washington signed into law a bill (SB 6016) that changes the terms of tax benefits extended to certain investment firms. Under existing law, businesses providing “international investment management services” (IIMS) were required to pay a business and occupation tax equal to the gross income from providing IIMS multiplied by a rate of 0.275% but were also eligible for an exemption from sales and use taxes when they purchase or use standard financial information. The bill modified that law in several respects, including an amendment restricting these tax benefits to “qualifying” IIMS firms. Among the criteria that a firm must now meet in order to qualify is the requirement that more than 25% of its employees be located in the state of Washington.