The Senate and House 2023–25 operating budget proposals include various provisos related to tax policy, benefit policy, and economic impacts. (This post refers to the budget proposals as passed by the Senate and approved by the House Appropriations Committee.)

First, the Senate proposal would reauthorize the Tax Structure Workgroup (TSWG). In December, the TSWG recommended that the Legislature consider replacing the business and occupation tax with a margin tax and increasing the local property tax growth limit factor. Under the TSWG provision in the 2021–23 operating budget (see Sec. 137 here), if the TSWG’s recommendations are not adopted during the 2023 legislative session, the TSWG must host more public meetings to collect feedback (subject to appropriations) and then modify its proposal to address that feedback. Then, the modified proposal would be considered by the Legislature in 2024. A final report from the TSWG is required by Dec. 31, 2024. The Senate budget proposal would maintain this timeline and appropriate $2.1 million in 2023–25 to facilitate the process (Sec. 141(3) and 914).

Meanwhile, the Senate budget would also appropriate $653,000 for the Department of Revenue to “research and analyze wealth taxes.” This would include considering “how existing and proposed wealth taxes are structured, compliance and administrative challenges of wealth taxes, best practices in the design and administration of wealth taxes, and potential data sources to aid the department in estimating the revenue impacts of future wealth tax proposals” (Sec. 141(27)). A final report would be due by Nov. 1, 2024.

Last year the TSWG rejected a wealth tax. Nevertheless, wealth tax bills received hearings in the House and Senate this year. (I wrote in depth about these proposals here.) The Senate budget signals that the wealth tax idea is not going away and could possibly show up again as part of the TSWG process. That said, the House budget would neither reauthorize the TSWG nor fund a wealth tax study.

Other tax policy provisos include:

• The Senate would appropriate $54,000 to implement ESSB 5082, which would repeal the non-binding advisory votes on tax increases (Sec. 135(9)). (I wrote about ESSB 5082 here.)
• The Senate would appropriate $250,000 “to develop an implementation plan for an online searchable database of all taxes and tax rates in the state for each taxing district” (Sec. 141(4)).

On the benefits side, provisos include:

• The House would appropriate $350,000 “for ongoing policy and program analysis of the Washington future fund program” (Sec. 123(2)). (See this post for more on the future fund idea.)
• The House would appropriate $300,000 for studies (due by June 30, 2025) on “the feasibility of implementing a universal child allowance, universal child care, and universal baby boxes,” “the feasibility of a social wealth fund for Washington state,” and “the current cash and cash-equivalent benefits currently available for Washington state residents who are nonworkers” (Sec. 230(11)).
• The Senate would appropriate $30,000 for a study (due Dec. 15, 2023) of “the retirement preparedness of Washington residents and the feasibility of establishing a portable individual retirement account savings program with automatic enrollment (auto-IRA) for private sector workers who do not have workplace retirement benefits” (Sec. 133(3)).
• The Senate would appropriate $1.2 million for UW “to establish washpop, a statewide integrated data repository for population and policy research on topics, including criminal justice and safety, economic prosperity and equity, and health and social well-being” (Sec. 605(63)).

Finally, other provisos would require economic and regulatory impact studies:

• The House would appropriate $250,000 for an economic impact study (due Dec. 31, 2024) of oil refining in Washington (Sec. 132(21)).
• The Senate would appropriate $250,000 for an economic impact study of the military and defense sector in Washington (Sec. 118).
• The Senate would establish a “housing regulation work group” (Sec. 920). The work group would “assess the impact government regulations have on the cost of housing and provide near and long-term recommendations to reduce cost and increase housing supply.” A final report would be due Dec. 1, 2024. The budget would appropriate $200,000 for this purpose (Sec. 129(56)).
• The Senate would appropriate $250,000 for the Office of the Insurance Commissioner and the Attorney General to study “regulatory approaches used by other states to address affordability of health insurance beyond rate review and to address any anticompetitive impacts of horizontal consolidation and vertical integration in the health care marketplace to supplement federal antitrust law” (Sec. 126(25) and 144(14)).

(For more on the Senate and House proposals, see here and here.)