Fuel will cost more, estates may owe extra, and employees gain fresh protections as Governor Bob Ferguson’s first legislative package takes effect.
Washington State is about to feel the impact of a sweeping batch of statutes that become active on July 1, 2025. From higher gas taxes to tougher equal‑pay rules, the measures aim to patch budget holes while strengthening labor and immigrant safeguards. Below is a quick look at the headline changes—and what you may need to do next.
Gasoline and diesel prices set to climb under new fuel tax plan
Drivers, brace yourselves. The state gas tax jumps six cents to 55.4 ¢ per gallon on July 1, and the diesel levy adds three cents this year (another three follow in 2027). An automatic 2 percent inflation adjustment kicks in for both fuels starting in fiscal 2026. Wondering how the money will be used? Officials say the extra $3.2 billion projected over six years will shore up transportation projects, including debt payments for Seattle’s SR‑99 tunnel.
Estates over one million face higher brackets under revamped inheritance tax
Estate planning just got more complicated. Senate Bill 5813 raises the top inheritance rate from 20 percent to 35 percent for estates exceeding $9 million, while increasing the exemption threshold to $3 million. Agricultural employees who materially worked the family farm can now qualify as “heirs,” a tweak proponents say keeps farmland in local hands. Have you reviewed your will lately?
Capital gains levy expansion targets high earners to fund public education
Another provision inside SB 5813 tacks an additional 2.9 percent onto long‑term capital gains above $1 million, lifting the effective rate to 9.9 percent and applying retroactively to January 1. Revenues are earmarked for K‑12 and college classrooms. Critics warn of investor flight, yet supporters counter that only about 3,000 taxpayers will feel the pinch.
Equal pay amendments and anti‑retaliation rules strengthen worker protections statewide
House Bill 1905 updates the Equal Pay and Opportunities Act, banning wage gaps based on factors such as age, race, immigration status, sexual orientation, or disability. Meanwhile, SB 5104 makes it illegal for employers to threaten deportation or immigration consequences when employees raise wage or safety complaints. If you supervise staff, double‑check your policies—non‑compliance could cost.
Additional July measures cover sick‑leave immigration hearings and mass‑layoff warnings
Two more laws arrive July 27. HB 1875 lets workers use accrued sick time to attend immigration proceedings, while the Mini‑WARN Act forces firms with 50‑plus full‑timers to give 60 days’ notice before major layoffs or closures. That means HR departments need updated notification templates, pronto.
| Measure | Effective date | Who pays more | New rate/threshold |
|---|---|---|---|
| Gasoline tax | July 1 2025 | All drivers | +6 ¢ / gal (55.4 ¢) |
| Diesel tax | July 1 2025 | Trucking & diesel users | +3 ¢ / gal now, +3 ¢ in 2027 |
| Inheritance tax | Deaths after July 1 2025 | Estates > $1 million | Top bracket 35 % |
| Capital gains tax | Retroactive to Jan 1 2025 | Gains > $1 million | Extra 2.9 % (total 9.9 %) |
Keeping track of every deadline can be tricky, so bookmark this table for quick reference.
What should Washingtonians do next to stay compliant and save money?
First, drivers might top up the tank before July 1. Second, high‑net‑worth families should revisit estate plans with a tax professional. Finally, employers must train managers on the new anti‑retaliation and layoff‑notice rules to avoid fines.
July’s legislative rollout touches wallets, workplaces, and even family inheritances. Staying informed—and acting early—can help taxpayers, businesses, and employees navigate the new landscape with fewer surprises down the road.