Tax Structure Work Group advances five reform concepts
On March 30 the Tax Structure Work Group voted to move forward five tax reform concepts for elaboration and analysis. To my surprise, a personal income tax was not one of the concepts that moved forward. A 2017-19 budget proviso (see section 101) initially established the Tax Structure Workgroup (TSWG) within the state House of […]
April 05 , 2022 - Emily Makings
Gov. Inslee’s budget vetoes will not have a significant fiscal impact
On Thursday, Gov. Inslee signed and partially vetoed the supplemental operating budget. (His veto message is here.) Appropriations levels have not yet been officially updated on the state’s fiscal site, but it looks like the vetoes will reduce appropriations from funds subject to the outlook (NGFO) by about $12.9 million. (As passed by the Legislature, […]
March 31 , 2022 - Emily Makings
The official budget outlook will continue to assume revenues from the capital gains tax
Today the Economic and Revenue Forecast Council (ERFC) held a budget outlook methodology meeting. The budget outlook workgroup wanted the ERFC’s guidance as to how to treat revenues from the capital gains tax in the upcoming official budget outlook (based on the 2022 supplemental). The capital gains tax was adopted last year, and the first […]
March 09 , 2022 - Emily Makings
Transportation budget’s exported fuel tax replaced with annual transfers from the general fund and public works assistance account
The transportation package that was proposed in February would have increased transportation revenues by $16.801 billion over 16 years. That included $2.053 billion in revenues from a new tax on exported fuel. The exported fuel tax provision was later stripped by the House. The conference report for the transportation budget would increase revenues by $16.988 […]
March 02 , 2022 - Emily Makings
What is the impact to the budget if the capital gains tax is unconstitutional?
Yesterday the Douglas County Superior Court ruled that the capital gains tax is unconstitutional. According to the ruling, the tax is an income tax and it violates the state constitution’s uniformity requirement and 1% limit on property taxes. The attorney general has already said he will appeal. If the state supreme court ultimately agrees that […]
February 24 , 2022 - Emily Makings
An alternative budget proposal would provide general tax relief; Senate Democrats introduce a new B&O tax relief bill
On Monday, Rep. Stokesbary proposed a supplemental operating budget that offers quite the contrast to the proposals from the chairs of the Ways & Means and Appropriations committees. Rep. Stokesbary’s proposal would reduce revenues from funds subject to the outlook (NGFO) by $2.118 billion in 2021–23 and by $8.347 billion in 2023–25. That includes two […]
February 18 , 2022 - WRC
New brief: Minimal Losses to Local Revenues in 2020 Are Largely Offset by Additional Federal Relief
Local government taxes and revenues were largely sustained in 2020. State taxes increased by 4.2% in FY 2020 and by 11.7% in FY 2021. Meanwhile, in CY 2020, taxes grew by 5.3% in Washington’s counties and fell by 2.9% in Washington’s cities. However, from 2010 through 2017, city tax growth exceeded that of the state. […]
February 18 , 2022 - Emily Makings
State transportation revenues are now estimated to be higher than expected last March
The Senate passed ESSB 5974, the transportation revenue package, earlier this week. I wrote about the bill as proposed here. Notably, before passage the bill was amended to remove the provision allowing cities to impose a 2% tax on the privilege of conducting a telephone business (the tax would still be allowed for natural gas […]
February 17 , 2022 - Emily Makings
State revenues are now $10.129 billion higher than expected at the end of the 2021 legislative session
Yesterday, Kriss wrote about the February revenue forecast, which estimates that—compared to the Nov. 2021 forecast—revenues in funds subject to the outlook (NGFO) will increase by $1.453 billion in 2021–23 and $1.320 billion in 2023–25. Revenues are expected to continue to grow going forward, though at a slower rate than we’ve experienced coming out of […]
February 10 , 2022 - Emily Makings
Senate passes bill that would reduce unemployment insurance taxes
Yesterday the Senate passed ESSB 5873 by a vote of 48–1. As passed by the Senate, the bill would reduce the unemployment insurance (UI) cap on costs to be recovered by the social tax for 2022 and 2023. (For more background, see here.) In 2021, the social cost factor was limited to 0.5%. Under current […]