Senate Democrats in Washington are advocating for new taxes to address a looming $16 billion budget shortfall, as revealed in a leaked email sent by Sen. Noel Frame (D-Seattle). The email, sent shortly after Governor Jay Inslee’s announcement of the shortfall, outlines additional taxes beyond those proposed by Inslee, which include a new wealth tax, a temporary 20% business surcharge, and an increase in business and occupation (B&O) tax rates.
Frame’s email lists seven additional “revenue options” for raising funds to help close the budget gap. Among these options are significant tax hikes on large corporations. One proposal seeks to remove the cap on employer payroll taxes for businesses earning $8 million or more annually, which could raise $7.8 billion over four years. An alternative version of the tax would apply to all businesses, even small ones, potentially generating $8.7 billion by 2029. Another proposal includes a 1% B&O surcharge on businesses earning taxable income over $500 million, which would generate $6.3 billion over the same period.
Frame’s email also suggests raising property tax caps from 1% to 3%, increasing taxes on real estate transactions over $3 million, imposing B&O taxes on storage units, and introducing an 11% tax on ammunition, firearms, and related parts. These additional taxes could collectively generate up to $940 million over the next four years.
Republicans have pushed back against these proposals, arguing that Washington State’s budget problems stem from excessive spending rather than insufficient revenue. Rep. Travis Couture (R) criticized the tax hikes, calling for cuts in reckless spending rather than new taxes.
