Against the backdrop of an approximately $15 billion budget deficit, Democratic state legislators approved around $10 billion in tax increases in the final days of the 2025 legislative session in order to reach a budget deal. Most notably for the physician community, bills were approved to increase the state’s business and occupation tax and apply sales tax to additional services, with many of the rate increases taking effect on Oct. 1.
The WSMA aggressively opposed these tax increases in concert with the physician community, with WSMA members sending in more than 1,000 messages to legislators in opposition to the B&O tax increase. We stressed that the tax increases will have the effect of decreasing patient access to care, increasing the cost of care, and fueling more consolidation into larger health systems-all running counter to what we consistently hear as concerns of legislators.
Mitigating the impact of these tax increases will be a top priority of the WSMA in the 2026 legislative session that begins in January. In the meantime, below are summaries of the two bills and additional resources from the Department of Revenue.