Washington lawmakers worked into Tuesday morning after an overnight session debating the so-called millionaires tax as the legislative session nears its scheduled end Thursday, with Republicans pushing amendments while the proposal inches closer to a possible vote.
The proposal would create a new income tax on the state’s highest earners. Under the plan, people making more than $1 million a year would pay a 9.9% tax on income above that threshold starting in 2029. Supporters, including Gov. Bob Ferguson, say the revenue would help fund programs for families and small business owners. If approved, the first payments would begin in 2029.
One amendment proposed Tuesday would allow a taxpayer to claim a charitable deduction equal to the amount claimed for federal income tax purposes. “We don’t want to encourage our charitable giving. This amendment squares or allows us to give more than what’s in the underlying bill,” Rep. Stephanie Barnard, R-Pasco, said. “I noticed recently the rules of fed charitable deductions change every year. Keep it the way it is and say no to this,” Rep. Sharon Wylie, D-Vancouver, responded.
Critics argue the measure violates the state constitution and warn it could eventually expand to other income levels. Opponents also say the tax could be headed to court if approved, potentially setting up a state Supreme Court showdown. Former Washington Attorney General Rob McKenna said Washington’s constitution legally considers income to be property, based on a broad definition adopted in the 1930s and repeatedly upheld by the state Supreme Court.
“They are, apparently are going to pass it without bothering to amend the Constitution. Presumably, they’re hoping the state Supreme Court will effectively amend the Constitution by deciding that income is not part of property. I don’t think they will,” McKenna said. He also said Washington voters have consistently rejected constitutional amendments 10 times excluding income from property.
If the House approves the amended bill, it would head back to the Senate for another vote on the changes. If senators sign off, it would go to Ferguson, who has said he plans to sign it. Opponents say they would file a citizen initiative to try to repeal the tax. The debate stretched through the night as lawmakers rushed to complete work before the Thursday deadline, with the marathon session highlighting deep divisions over whether Washington should implement an income tax despite repeated voter rejection of such measures.
