Senate Bill 5411 reenacts and amends RCW 82.04.050 to change the statutory definition and scope of "sale at retail" (retail sale) for Washington state sales tax purposes, and it adds a new section stating that RCW 82.32.805 and 82.32.808 do not apply to this act. The bill is titled to address tax treatment of pilates studios and gymnastics facilities, was introduced in the 69th Legislature (read first time 01/22/25), referred to the Senate Ways & Means Committee, and takes effect October 1, 2025. Legally, the bill modifies an existing law (the retail sales tax definition) rather than creating a new crime or changing penalties. It expands and clarifies what transactions are treated as retail sales (including sales of tangible personal property, many digital goods and software access models, rentals with operators, and many recreational and fitness activities) and it lists numerous specific inclusions and exclusions. Notably it treats the operation of an "athletic or fitness facility" as a retail sale subject to tax while carving out many exclusions, including separately stated charges for certain non‑fitness uses, certain discrete facility portions, specified ancillary services, physical or occupational therapy under specified conditions, employer‑provided employee facilities, educational institution access for students and staff, and classes or events for yoga, chi gong, pilates, gymnastics, or martial arts when held at community centers, parks, school gymnasiums, colleges/universities, hospitals or other medical facilities, or private residences or any facility not operated as part of an athletic or fitness facility. The bill also adds or clarifies definitions (for example, "martial arts," "physical fitness activities," "extended warranty," "permanent" use of digital goods, and "data processing"), enumerates recreational activities treated as retail sales with limited exceptions (fishing, hunting, swimming access, go‑karts, playgrounds, shooting sports, paintball, skating, nonmotorized snow sports, water sports, etc.), and treats certain purchases made by recipients of qualifying grants as retail sales for specified construction, land‑clearing, and landscape services. The extracted text is incomplete in places: the full definition of "athletic or fitness facility" is cut off, the complete new section language is not shown, and other details relevant to the tax treatment of pilates studios and gymnastics facilities may appear elsewhere in the bill and are not available in the provided facts.

If enacted, the bill makes clearer which recreation and fitness charges are treated as taxable retail sales and which are not. Operators of athletic or fitness facilities will generally need to treat charges for facility use, memberships, classes, and associated services as retail sales and collect sales tax, unless a specific exclusion applies; by contrast, yoga, chi gong, pilates, gymnastics, and martial arts classes held at community centers, parks, school gymnasiums, colleges or universities, hospitals or other medical facilities, private residences, or any facility that is not operated as part of an athletic or fitness facility are carved out and would not be taxed under this provision. Educational institutions’ charges to students and staff for listed activities are excluded from tax while charges to alumni or the general public are taxable, and purchases made by recipients of certain qualifying grants are treated as retail purchases and therefore taxable, which could raise costs for organizations using those grants. Key practical impacts include more businesses having a new responsibility to collect and remit sales tax on memberships, discrete event fees, and many activity charges (affecting pricing, bookkeeping, and compliance costs), while community-based or institution-run classes in the listed locations may avoid that tax treatment. The act takes effect October 1, 2025. The precise boundary between taxable and nontaxable situations is somewhat unclear here because the full statutory definition of “athletic or fitness facility” is cut off in the available text, and the bill also states that RCW 82.32.805 and 82.32.808 do not apply without further explanation in the provided facts.