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Washington may have sky-high sales tax, but the absence of any income tax has always been a consolation for citizens calculating just precisely how they could afford to live here. This morning, however, Democrat Senator Jeanne Kohl-Welles re-introduced a bill that would change that by imposing a state income tax. (Check out Political Buzz' reporting on the bill, including a response from Kohl-Welles.) The proposed 1 percent tax would only affect those making more than $500,000 a year, so maybe the image of budget-traumatized, poor citizens eking out an existence is not the best to conjure. If you're making over $500,000 a year, there are no ifs, ands, or buts about it: you can afford the 1 percent income tax, and we're terribly sorry if it requires you to liquidate one of your vacation homes or, god forbid, drive a car more than two years old.
But will Washington legislators and their constituents be receptive enough to the idea to actually pass the bill through state legislature? Would Gregoire sign it? Would this drive away the people financially solvent enough to spend the money to stimulate the state's economy? Is this really the direction Washington wants to go? You tell us.
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Before someone starts freaking out, calling out "class warfare!" and other garbage, it's important to keep in mind that we tax the fuck out of the poorer members of our state.
I read that the difference in taxes between poor and rich is something like 18% and 3%.
Unfortunately, there is no way this will pass. Republicans will invoke the slippery-slope argument and get even the poorest of the poor rallied against it, e.g. "Once we have an income tax, those tax-and-spend liberals will tax everybody." The bill will go down in flames. The only way to get an income tax is to move to Oregon.
The missing poll item:
Remove the sales tax and replace it with a progressive income tax.
(Just like Oregon)
Please, in this discussion, let's not forget that the pertinent point is not % of income for tax payers but actual dollars (alternately % of tax revenues).
Thought exercise: Start with what % of the state budget those in the Top 10% should pay. What % of the budget should the Top 25% pay? Use that result to figure what taxes on the rich should be.
(For the US, the Top 10% pay 70% of the total tax bill, and the Top 25% pay 85%, with half the population paying all most ALL of the taxes. Whether that's fair or not is a different discussion...)
I have been wondering when our elected government would get to this. It is going to come whether you vote against it or not, just like the third runway at seatac (pondering a fourth).
Washington state will most likely follow the California model: state income tax and state sales tax. Why not reduce beauracracy?
We'll never, ever, ever, ever have a state income tax.
But let's follow California and try to legalize pot sales.
Creating a state income tax on the rich is the first step towards expanding the state income tax to everyone. Don't fall for it! It's pretty easy to start a tax on the rich and later surreptitiously lower the income bar until eventually it applies to the middle class too (they'll justify the tax increase as needed because of budget shortfalls resulting from wasteful spending and poor budgeting - although they'll present this as hey, you want the schools to stay open right? Think of the children.).