Dear Friends and Neighbors,
House Democrats released the session's first operating budget proposal on Friday. Although this is largely a starting point in negotiations towards a final budget solution, I was still disappointed to learn it contains copious new spending relying on tax increases of around $1.5 billion at an average of about $276.51 per individual taxpayer in Washington.
Washington state is expected to receive about $3 billion more than we did during the last two-year budget cycle. This is a nearly 9 percent increase. Not many families in the Spokane region received a 9 percent increase in their personal incomes.
The Democrat proposal includes these new taxes:
- Imposing a capital gains tax of 5 percent with various exemptions (all revenue would be directed into the newly created Student Investment Fund which would drive out funds to basic education, higher education, and a reserve account based on a formula);
- Increasing the B&O tax rate on services to 1.8 percent with an increased small business credit;
- Closing various tax incentives, including a Marketplace Fairness tax which imposes sales tax on internet sales if a five-part nexus test is met.
Our economy is slowly recovering. Too many people are still either unemployed or underemployed. Raising taxes in this economy will not spur economic growth nor will it help attract new jobs to our state.
I am striving to pursue a budget without additional taxes and one that funds education first, empowers the most vulnerable, and protects our streets; one that reflects our economy and positions use wisely in the coming years.
421 John L. O'Brien Building | P.O. Box 40600 | Olympia, WA 98504-0600
(360) 786-7922 | Toll-free: (800) 562-6000