Even before state lawmakers passed a large package of new taxes last year, the state already had a reputation for putting a significant tax burden on businesses, according to a recent report. 

In 2024, Washington businesses paid half of all state and local taxes, which include sales, property, business and occupation (B&O) and many other taxes, according to an analysis by the Council on State Taxation. 

The state also has the 11th highest average taxes paid per employee in the nation at $10,400. That’s more than 20% above the national average of $8,600, with B&O taxes a novel cost compared to other states. 

Another think tank, the Tax Foundation, also lists the state as sixth worst in tax competitiveness, with the state’s sales taxes, unemployment insurance taxes and corporate taxes being particularly heavy. 

“Washington has many advantages as a state, but the tax burden is a counterbalance,” said the Washington Research Council in its summary of the recent reports. “Consequently, as the tax burden increases, it could cause some individuals and businesses to move out of state or to shift employment to other states. It could also result in fewer businesses starting in Washington in the first place.”