Because the 2026 state legislative session approaches, rumors proceed to swirl a few slew of recent tax proposals that are more likely to be thought-about. These proposals embrace a payroll tax and an earnings tax, amongst others.
Whereas there are wholesome debates over taxes each legislative session, these proposals warrant specific scrutiny as they arrive on the heels of the biggest tax enhance in Washington state historical past. The Legislature handed and the governor signed that final spring.
Taxes are essential to fund expenditures associated to public providers. However when authorities spending creeps past core providers and expands into discretionary packages, pointless tax will increase trigger hurt to Washington state residents, small companies and our economic system.
Regardless of the biggest tax enhance in Washington’s historical past, we proceed to listen to from legislators that we face a price range shortfall. The query have to be requested whether or not this shortfall is actually the results of inadequate tax income, or whether or not a discount in spending must be a part of the answer. In a poll printed final yr by the Seattle Metro Chamber, 76% of voters in Washington agreed that the state has greater than sufficient cash to handle necessary priorities.
In only a single decade, state spending has almost doubled from $43.6 billion in 2016 to $85.3 billion in 2025, in line with the state’s Fiscal Data webpage. So, whereas Washington state residents and companies are topic to file ranges of taxes, legislators are approving budgets which spend twice as a lot as they did a decade in the past.
I’d submit that if the typical Washington household or small enterprise doubled their annual spending, they might count on to see far higher outcomes from that spending than what we at present see from our state authorities. And if that household or small enterprise confronted a price range shortfall, as one may anticipate after having doubled their annual spending, I’m assured they might look first to scale back spending to extra applicable ranges earlier than viewing the state of affairs as a income drawback.
No matter one’s perspective on spending ranges and tax coverage, what is obvious is that these new taxes will hurt, not assist, our state’s economic system. These impacts are being, and can proceed to be, felt by residents and companies alike. Whereas proponents have tried to argue that the tax will increase will solely impression massive companies and the rich, the identical poll printed by the Seattle Metro Chamber confirmed that 83% of voters imagine firms will cross the price of tax will increase onto customers.
In response to the Tax Basis’s 2026 Tax Competitiveness Index, Washington state is without doubt one of the worst states in your complete nation for tax competitiveness, having fallen to the rank of 45th total. This quantity is not only an information level however is consultant of an financial local weather that’s making Washington state an more and more difficult place to stay, work and play.
It’s attention-grabbing to notice that the identical legislators who supported the biggest tax enhance in state historical past are actually lamenting the affordability disaster in Washington, as if there was not a direct connection between the 2. One solution to enhance affordability and competitiveness in our state can be for legislators to contemplate spending reductions and tax aid.
As an area authorities official, I used to be perplexed to listen to a state legislator not too long ago comment that it’s our accountability as native authorities leaders to “assist legislators educate the general public on why tax will increase are wanted.” Certainly, simply the other is true. It’s elected officers who serve on the pleasure of the general public, not the opposite method round.
If we would like our state to have a robust economic system and an inexpensive price of dwelling, legislative leaders should look to reasonable public spending and supply tax aid to Washingtonians within the upcoming legislative session. We’re blessed to name one of the lovely areas on earth residence. Let’s ensure the subsequent technology has the chance to stay, work and play in a thriving Washington state.
