Washington legislature passes bill to exempt newspapers from state gross-receipts tax to 'support local journalism'

Pexels/Digital Bugg photo via Columbia Basin Herald 

Efforts to shift government policies to help local news media, now focusing on states instead of Congress, have scored their first major victory. The Washington State Legislature has sent Democratic Gov. Jay Inslee a bill that eliminates the 0.35% gross-receipts tax on newspapers and certain digital news media.

Senate Bill 5199 "reduces the business and occupations tax rate to 0% for newspaper publishing and for news websites that are the successors to newspapers that were published prior to Jan. 1, 2008," reports Rebecca Pettingill of the Columbia Basin Herald. "The tax break is only effective for 10 years, beginning on Jan. 1, 2024."

The nonpartisan legislative staff report on the bill says it "states a specific public policy objective of protecting and supporting local journalism," and if a review by the legislature's audit committee "finds that [the] exemption accomplishes its goal of supporting local journalism across the state, measured by retaining 75 percent of journalism jobs, local newspapers, and community-focused online news outlets based in Washington as of December 31, 2022, or if a review finds the tax exemption enables locally based journalism outlets to continue to exist when compared to states that did not provide similar tax incentives, then a legislative presumption is created that the 2034 expiration date should be extended."

Fred Obee, executive director of the Washington Newspaper Publishers Association, told Pettingill, "As government watchdogs, newspapers are essential to our democracy. . . . Not only do newspapers keep the public informed and elected officials honest, they also connect merchants to their essential market and people to each other." Bob Richardson, regional general manager of Hagadone Media – Washington, which publishes the Herald, said, "The passage of Senate Bill 5199 shows the importance of newspapers in our local communities. We strive to be the voice of the people in our communities."

The bill passed the House 89-7 and the Senate 47-1, with the only no vote from Sen. Phil Fortunato (R-Auburn), who noted that it was the only tax break passed by the Legislature this session. He has sponsored other tax-break bills that haven't gotten a hearing.