A taxing situation for our neighbors to the Northwest

This could be worth keeping tabs on, to see how it plays out…

Beginning on October 1, 2025, a new sales tax on services takes effect in Washington. As reported by the Washington State Standard (and republished on the Idaho Capital Sun):

Senate Bill 5814 is one of the biggest moneymakers used to bring in an estimated $3.6 billion over the next two years to fill a shortfall in the operating budget. This law is expected to fuel $1.1 billion in the two-year budget that began July 1, and $2.6 billion over four years. Hundreds of millions of dollars will also flow to local governments, as they get a share of state sales tax proceeds.

Advertising services are among those that will now be taxable, and is expected to bring in roughly $475 million over the next four years, according to the Washington State Standard. Comcast, however, believes the sales tax on advertising services is illegal, and is suing to get it overturned.

The Washington State Department of Revenue issued a release in July outlining details:

Starting Oct. 1, 2025, businesses must collect retail sales tax on advertising services. Additionally, gross income from these activities is subject to business and occupation (B&O) tax under the Retailing classification.

What are advertising services?

Advertising services means all digital and nondigital services related to the creation, preparation, production, or dissemination of advertisements, including, but not limited to:

  • Layout, art direction, graphic design, mechanical preparation, production supervision, placement, referrals, acquisition of advertising space, and rendering advice concerning the best methods of advertising products or services.
  • Online referrals, search engine marketing, and lead generation optimization, web campaign planning, the acquisition of advertising space in the internet media, and the monitoring and evaluation of website traffic for purposes of determining the effectiveness of an advertising campaign.

Advertising services do not include:

  • Web hosting services and domain name registration.
  • Services rendered in respect to the following:
    • Newspapers as defined in RCW 82.04.214.
    • Printing or publishing under RCW 82.04.280.
    • Radio and television broadcasting within this state as defined in RCW 82.04 (section 1, chapter 9, Laws of 2025).
  • Services rendered in respect to out-of-home advertising, including:
    • Billboard advertising.
    • Street furniture advertising.
    • Transit advertising.
    • Place-based advertising, such as in-store display advertising or point-of-sale advertising.
    • Dynamic or static signage at live events.
    • Naming rights.
    • Fixed signage advertising.
    • Note: This does not include direct mail.

It will be interesting to see what comes of this, particularly the Comcast lawsuit, and how it ultimately affects agencies in Washington. It’ll also be worth watching to see if lawmakers in neighboring states — including Idaho — draft similar legislation in the future, using this model as a source of additional tax revenue.

Truth

As usual, John January speaks the truth for so many of us.

Me too, John. Me too.

The call came from inside

Several months ago we shared that Drake Cooper was looking for a Creative Director.

It appears they found the right candidate inside their own four walls, so to speak.

Continue reading “The call came from inside”

Moving on

People in the agency business come and go on a regular basis. For any number of reasons. While the trends may not be as pronounced locally as they are at a national level, it certainly happens.

But every once in a while there’s a departure that makes us stand up and take notice. In recent months, there have been two.

In late November, Marc Cowlin exited his role as VP of Content and Digital Marketing at Duft Watterson, and in doing so effectively shuttered the shop’s San Francisco presence. A little digging around LinkedIn in the weeks that followed revealed that he is now with BlueOwl, a San Francisco-based technology company.

Separately, in late December Jeremy Chase left Drake Cooper (again), this time to take on the role of VP of Business Development at Salt Lake City-based Love Communications. The update came a couple weeks after Drake Cooper’s announcement that agency ownership had been converted to an ESOP structure.

I do not presume to know the reasons behind either of these departures, as there’s always more to the story than what may be shared publicly.

I’ve known both Jeremy and Marc for many years, and wish them nothing but the best in their respective new roles.

Your next five

I happened to catch this exchange between Derek Walker and Nancy Hill on Twitter a couple months ago:

By way of backgrounds, Derek is the “janitor, secretary, mailroom person and owner” of brown and browner advertising. Nancy is the CEO of Media Sherpas and former President/CEO of the American Association of Advertising Agencies (4A’s). Both are fantastic people to follow, should you feel so inclined.

While the number may be arbitrary, the questions are still valid.

For the decision makers in the audience, do you have a wish list? Do you know who your next five are?