(The Center Square) – The income tax bill introduced by majority Democrats last week took another step toward becoming law today in the Washington Legislature.
Senate Bill 6346, a 9.9% tax on income over $1 million, passed out of the Senate Ways and Means Committee Monday with some amendments offered by Democrats to make minor changes to how the projected $3.5 to $5 billion annually generated by the tax will be dedicated.
Republicans offered several amendments of their own, all of which were rejected by Democrats including an amendment offered by Sen. Chris Gildon, R-Puyallup, that would make the entire bill null and void unless lawmakers amend the constitution to codify that only millionaires will be taxed on their income.
“It would codify the rate at 9.9% as well as the income threshold at $1 million,” said Gildon. “This has to do with trust. We’ve seen just in the committee hearing recently that over 61,000 people signed in against this bill. These are people who understand that this is just the first step towards creating a universal income tax that’s going to apply to everyone in our state.”
With no response or discussion to the amendment offered, Committee Chair June Robinson, D-Everett, simply asked members to reject it and by a voice vote, it was turned down.
Every Republican amendment met the same fate.
As reported by TCS, majority Democrats have left some future wiggle room for expanding the income tax, stating they are not willing to bind future legislatures that may have different budget priorities.
When time came for final passage of the bill, Sen. Keith Wagoner, R-Sedro Wooley, noted that wealthy Washingtonians will continue fleeing the state to avoid the tax, as they have been in recent years since passage of the capital gains tax.
“They’re already leaving, so the number of people not paying tax is going to include some of the same millionaires that we’re counting on to pay. I have a few friends in that category. They’re not here anymore. They’ve reincorporated in other states and through LLCs, and that’s just a way to kill the golden goose,” Wagoner said. “This is the law of diminishing returns. The more you try to get, the less you’re going to get.”
Sen. John Braun, R-Centralia, also spoke against the bill before final passage.
“This bill is bad for the state of Washington. It ignores the constitutional limits and the precedents the State Supreme Court has put in place. It ignores the will of the people, and it ignores the economic impact it’s going to have on our state,” said Braun. “All this is, is another bit of the apple, taking more money out of our economy while doing nothing to balance the scales in any meaningful way.”
Gov. Bob Ferguson supports the income tax on millionaires, but last week said he would not sign the bill unless it includes wider tax relief for lower income families and small businesses.
In the current form, the bill directs funds to the state general fund to support sales tax relief, expands the Working Families Tax Credit and expands business tax relief.
If it is does become law, it would take effect January 1, 2028, with the first proceeds available April 2029, however court challenges are expected.
