A provision buried in Washington's SB6113 reshapes how staffing costs are taxed for fitness businesses—and most owners haven't heard about it yet.
Most gym and fitness studio owners in Washington don't realize that a technical provision in Senate Bill 6113 directly affects how they're taxed on temporary staffing services. Understanding this change—and which staffing arrangements fall outside the new tax—can help you plan labor costs more accurately.
Washington imposed a new retail sales tax on temporary staffing services, effective October 1, 2025, under ESSB 5814. Senate Bill 6113, signed into law, clarifies which staffing arrangements are excluded from that tax. The clarification in SB6113 (Section 2, pages 6–7) applies both going forward and retroactively to October 1, 2025.
This matters because the exclusions directly reduce your tax liability on certain staffing expenses—a recurring dollar impact that compounds over time.
Under SB6113, the new retail sales tax on temporary staffing services does not apply to:
If your gym or studio uses a staffing agency to fill positions in these categories, those services fall outside the new retail sales tax and the retailing B&O tax that would otherwise apply to the staffing agency's revenue.
The exclusions are narrow but important. If you hire temporary staff through an agency for general fitness instruction, front desk, or cleaning—services not listed in the exclusions—the new retail sales tax applies. But if you use paymaster services to handle payroll processing, or if you engage independent contractors rather than temporary employees through an agency, those arrangements avoid the tax.
The distinction matters most for fitness studios and gyms that rely on flexible staffing models. You'll want to review your current staffing arrangements and invoices from staffing agencies to confirm which services are taxable and which are not.
Because SB6113's clarification applies retroactively to October 1, 2025, it may affect tax returns or payments you've already made. If you've been charged retail sales tax on staffing services that fall into one of the excluded categories, you may have grounds to request a refund or adjustment. This is worth discussing with your accountant or tax advisor, especially if you've already filed returns for the period from October 1, 2025 onward.
Review your staffing invoices and contracts to identify which services you're using. If you use paymaster services or engage independent contractors, document those arrangements clearly. If you use temporary staffing agencies for other roles, confirm with your provider whether the new retail sales tax is being applied—and at what rate.
The language in SB6113 is technical, and tax treatment can vary depending on how your staffing relationship is structured. A conversation with a tax professional familiar with Washington's new staffing tax rules will help you ensure you're paying only what's required and not leaving money on the table through missed exclusions.
Source: Washington Senate Bill 6113, Section 2, pages 6–7; effective October 1, 2025 (retroactive and prospective).