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Gov’s Never Met a Tax He Didn’t Like

February 15, 2019

You may have seen Governor Inslee in the news earlier this week talking about the “pockets of wealth” needing to be tapped to add revenue to his budget – up to $10 billion in additional taxes, on top of the already $7 billion unforecasted windfalls the state has seen this biennium. There are three very real proposals on the table that are gathering support in Olympia that we all need to “red tag”:

  1. Despite an Internal Revenue Service (IRS) court ruling saying a capital gains tax is an income tax, which is not allowed in Washington state, Democrat leaders continue to press for adoption.
  2. Nearly 1,400 hairdressers came to Olympia to protest their classification as independent contractors, which captured legislative attention. The solution? Lawmakers are now openly discussing DOUBLING B&O taxes on all services, including the building industry. This raises costs on business, housing, and poses a major threat to the survival of small businesses – the backbone of our state.
  3. Currently, the most immediate threat, adjustable Real Estate Excise Tax (REET) taxes, are swiftly making their way through the capital. Some housing and lot sales would drop to 0.75 percent, while sales over $1.5 million would double to 2 percent REET. We have many questions we would want to address: How are lots platted for individual sale? What about parcels that are land rich and house poor? How would new construction be handled under the proposal? Some could see REET charged at multiple levels. The business community needs to hold fast against adjustable REET, but there are rumblings that some sectors are accepting a new REET tax structure as a foregone conclusion and are already trying to turn business against itself.

Not one of these proposals helps to create a more affordable and diverse housing market for families in Washington state. It’s simple: added costs = higher prices. Please help us educate lawmakers by weighing in against this legislation.

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