WA Senate passes transportation bill with e-bike tax that exempts class 1 and 2 bikes with certified batteries
ESSB 5801 as passed by the Washington Senate. So far, the House legislation does not include a bike tax.A 10% tax on the sale of all Class 3 e-bikes as well as e-bikes lacking certain certifications will be on the table when the Washington State House and Senate work to reconcile differences between their transportation budget bills. The state Senate passed the supposedly bi-partisan SB 5801 by a vote of 31-18 with only four Republicans voting in favor, as Ryan Packer noted on Bluesky.
Senators added the exemptions following significant backlash to the bill's original 10% surcharge on all e-bike sales, including an action alert from Transportation Choices Coalition urging folks to send letters to their Senators opposing increased bike and transit taxes and fees. Seattle Bike Blog also reported on the potentially devastating impact to the state's already-struggling bike shops, which are already facing major uncertainty due to President Trump's ever-changing tariff threats that could have a big impact on bike prices, especially for e-bikes. Senators chose not to fully remove the e-bike tax, but they did exempt major e-bike categories from the proposed tax. As passed, the state would levy a 10% sales tax surcharge on the sale of all higher-speed class 3 e-bikes, which can receive power up to 28 miles per hour, as well as any class 1 or 2 bikes with electrical systems that have not received EN or UL certification. Many major e-bike makers already have these certifications, which demonstrate that their batteries and associated electrical systems passed a third-party safety analysis to prevent fires and injuries. However, they are private certifications (UL, or Underwriters Laboratory, is a for-profit company for example), and it does seem a bit odd to require by law certifications from specific private companies.
The changed version of the tax does take some of the edge off the detrimental effects on bike shops, but it would also bring in even less revenue. It will be up to the House and then the cross-chamber conference process to determine whether the bike tax is even worth developing into the final bill, especially given the strong opposition and the terrible optics of taxing e-bike sales at the same time the state is rolling out an e-bike rebate program. This contradiction makes it look like the legislature can't make up its mind about whether to encourage or discourage e-bike sales.
The state's e-bike class system was created in 2018 to give the state and local jurisdictions a way to regulate the use of e-bikes, which had been operating in a legal gray area until that point. Motors on class 1 (pedal assist) and 2 (throttle) e-bikes must stop providing assistance once the bikes reach 20 mph. Due to the slower assisted speed, class 1 and 2 bikes are generally treated the same as pedal-only bicycles under state law. Class 3 bicycles are not allowed on most multi-use trails or sidewalks, but they can be ridden on public streets. Local jurisdictions may have further restrictions.
Despite the operational advantages of class 1 and 2 e-bikes, faster class 3 e-bikes are still popular, and most e-bike companies offer class 3 models or options. It's not immediately clear what percentage of e-bikes sold in Washington State are class 3 or do not have EN or UL certification for their electrical systems and batteries. The changes mean the e-bike tax would bring in even less funding than the already-low $9 million over six years estimated for an e-bike tax without any exemptions, though the bill materials do not include an estimate.
Senate passage does not mean the e-bike taxes will make it into law because the state House's transportation bill does not currently include any e-bike taxes. Both chambers will need to agree on a final version to pass and send to Governor Bob Ferguson. Given the likely low level of revenue it would generate (and the fact that it will cost the state money to set up a revenue collection system for the new tax), the tax may have a tough time making it through the cross-chamber conference process between the House and Senate.
However, passage in the Senate means people opposed to any version of the e-bike tax will need to keep fighting. As we reported last week, an extra 10% sales tax on e-bike sales on top of existing sales tax would have been devastating for Washington's already-struggling bike shops. While exempting class 1 and 2 bikes with proper certification would be less detrimental for shops, it would still impact many sales and give prospective buyers a reason to shop elsewhere.