Washington Tech Tax Draws Complaints From Grocers
Companies outside the tech sector say they face unexpected bills under a surcharge designed to target large technology firms.
Updated on Nov. 10, 2026 in Healthcare
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Grocers, railroads, and healthcare companies are complaining about a Washington state tech surcharge enacted in 2019 that was designed to tap large technology firms. The state is now probing how broadly the surcharge applies.
Why it matters
The surcharge was intended to fund college financial aid and workforce training, and its reach beyond the tech sector raises questions about how state tax policy is applied to diversified corporate groups. Residents and businesses across Washington may face shifts in the tax burden depending on how the state resolves the scope question.
The surcharge applies to corporate groups with more than $25 billion in worldwide annual revenue that include at least one affiliate developing software or hardware, providing cloud services, or operating an online marketplace. Whether grocers, railroads, and healthcare companies fall within that definition remains under state review.
The players
Washington state
Washington is the Pacific Northwest state that enacted the tech surcharge and is now reviewing how broadly it applies.
The details
Grocers, railroads, and healthcare companies are facing unexpected tax bills under the surcharge, which was passed in 2019 with tech industry support. Washington state is probing the scope of the surcharge's application to determine which corporate groups are covered.
Timeline
2019: Washington enacted the tech surcharge.
November 10, 2026: Complaints from grocers and others were reported, and the state began probing the scope of the surcharge.
Market Landscape
Washington's 2019 tech surcharge was enacted with tech industry support to fund college financial aid and workforce training. The current complaints suggest the tax reaches well beyond the technology companies it was designed to target, into sectors like grocery, rail, and healthcare.
Companies outside the tech sector that meet the revenue threshold and have a qualifying affiliate may face surcharge bills, which could affect prices and costs for Washington consumers. Businesses should watch the state's scope determination to know whether they are covered.
The takeaway
Businesses operating in Washington should check whether their corporate group meets the $25 billion revenue threshold and includes a qualifying tech affiliate. Monitoring the state's scope decision is the most direct way to anticipate any surcharge liability.
Further reading
For related context on how state tax rules affect health-sector employers, see Healthcare coverage.
Source note: This article includes information reported by Bloomberglaw.
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