SB 6006
In CommitteeSenate
Food banks/sales tax
Exempting food banks from the retail sales tax imposed on certain services.
This status may be delayed. See Action History below for the latest updates.
How does a bill become law?
- Introduced: The bill is filed and assigned a number.
- Committee: A subject-matter committee holds hearings, takes public testimony, and decides whether to advance the bill.
- Floor Vote: The full chamber (House or Senate) debates and votes on the bill.
- Opposite Chamber: The bill repeats the committee and floor vote process in the other chamber.
- Governor: The Governor reviews the bill and decides whether to sign or veto it.
- Signed: The bill has been signed into law.
AI Analysis
This bill exempts food banks from paying retail sales tax on certain services they receive, such as delivery, storage, and facility maintenance, to reduce their operating costs and improve efficiency in distributing food. The exemption applies only to services that would otherwise be taxed under Washington’s retail sales tax law.
- Amends RCW 82.04.050 to clarify that food banks are exempt from retail sales tax on certain services they receive — specifically, services that are otherwise classified as 'retail sales' under state law.
- Adds a new section (Sec. 2) stating that existing rules about tax collection timing and reporting (RCW 82.32.805 and 82.32.808) do not apply to this exemption, allowing for smoother implementation.
- Limits the exemption to services used directly by food banks in their operations — such as delivery, storage, facility maintenance, and equipment repair — and only if the food bank is a nonprofit organization serving food assistance needs.
Who is affected
- Food banks — Food banks that currently pay retail sales tax on certain services (e.g., delivery, storage, or equipment maintenance) will no longer be required to pay that tax on those services after the bill takes effect.
- Service providers and vendors — Retailers and service providers who contract with food banks may see changes in billing practices, as they will no longer be required to collect sales tax on otherwise taxable services provided to food banks.
- State and local governments — State and local governments may see a small reduction in sales tax revenue due to the exemption, though the impact is expected to be minimal.
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (3)
Food banks—nonprofit organizations serving food assistance—will avoid paying retail sales tax on essential operational services (e.g., delivery trucks, warehouse storage, facility upkeep), reducing their operating costs and freeing up resources for expanded food distribution. This directly benefits low-income households and individuals relying on food assistance, especially in rural and underserved areas where food banks operate on tight margins.
Business & EmploymentPeopleRef: Sec. 1 amends RCW 82.04.050 to exempt food banks from retail sales tax on delivery, storage, facility maintenance, and equipment repair services.By exempting food banks from standard sales tax collection and reporting requirements, the bill reduces administrative burden on both food banks and service providers—allowing small nonprofits to redirect staff time and resources toward direct service delivery rather than tax compliance.
Business & EmploymentPeopleRef: Sec. 2 clarifies that existing reporting and collection rules (RCW 82.32.805 and 82.32.808) do not apply, enabling smoother implementation.By lowering food bank operating costs, the bill helps sustain and potentially expand food access—contributing to community resilience, reducing food insecurity, and supporting public health outcomes, especially for vulnerable populations (children, seniors, people with disabilities, and those experiencing poverty).
Public SafetyPeopleRef: Bill limits exemption to nonprofit food banks 'serving food assistance needs' and to services 'used directly' in operations (e.g., delivery, storage, facility maintenance, equipment repair).
Potential Concerns (1)
The bill reduces state and local sales tax revenue by an estimated $2.5 million annually, which could marginally constrain public budget flexibility—though the impact is relatively small relative to the state’s $100B+ biennial budget. This reduction could affect public services over time, especially if repeated across multiple exemptions without offsetting revenue.
Local GovernmentRef: Fiscal Impact: $2.5M annual revenue loss
Who Is Most Affected
Food banks—especially small- to mid-sized nonprofits—will see direct cost savings on delivery, storage, and facility maintenance services, allowing them to stretch limited donor and grant funding further and potentially serve more people. This is a clear positive impact.
Service providers (e.g., trucking companies, warehouse operators, facility maintenance firms) that contract with food banks will no longer collect sales tax on those transactions. This simplifies billing and reduces compliance risk, but does not increase their revenue—so the net impact is neutral to slightly positive.
State and local governments experience a small but measurable reduction in sales tax revenue ($2.5M/year), which—while modest relative to total revenue—could compound over time if similar exemptions proliferate without offsetting measures. This is a minor negative impact.
Low-income households and individuals relying on food banks benefit indirectly but significantly: reduced food bank costs can translate to increased food availability, more frequent distributions, and expanded geographic reach—especially in food deserts. This is a strong positive impact.
Local economies that depend on food banks for nutrition security (e.g., rural communities, tribal nations, regions with high poverty) benefit from enhanced food system resilience. This is a positive but diffuse impact.