Several of the major tax bills passed by the Legislature this year were changed at the end of session in ways that could affect revenues. (For example: ESSB 6346, ESB 6228, EHB 2487, and ESB 6347.) For each of these bills, the supplemental operating budget assumes the revenues in the fiscal note available at the time. As revised fiscal notes become available for these bills, the ending balance for the operating budget could move up or down. (None of these bills have yet been signed by the governor.)

The fiscal note for ESB 6347 as passed by the Legislature is now available. As passed, ESB 6347 would mostly repeal the estate tax changes that were made last year. First, it would repeal the estate tax rate increases. For example, the top rate would be 20% instead of 35%. Second, it would reinstate a defunct inflationary measure. (For more on this issue, see here and here.) Effectively, the exclusion amount would never be adjusted for inflation. Third, the exclusion amount would be set at $3.0 million for estates of people dying on or after July 1, 2026.

Before the changes last year, the exclusion amount had been stuck at $2.193 million. Last year’s bill fixed the inflation adjustment and increased the exclusion amount to $3.0 million for estates of people dying between July 1, 2025 and Jan. 1, 2026. Because of the inflation adjustment, the exclusion amount rose to $3.076 million for estates of people dying after Jan. 1, 2026.

The supplemental operating budget assumes that ESB 6347 would reduce revenues by $44.8 million in 2025–27 and $389.9 million in 2027–29. However, that estimate assumed an earlier version of the bill that would have only rolled back the tax rates. The fiscal note for the version that was passed by the Legislature estimates that it would reduce revenues by $41.1 million in 2025–27 and $340.7 million in 2027–29.