It's Tax Day, but you are lucky! Give thanks you aren’t ALSO filing state income taxes… at least not yet!

By DAVID BOZE  | 
Apr 18, 2022
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Many people struggle to file their income taxes. They sort through a maze of paperwork and rules, try to find the documents they need to fill in the forms and schedules, and a grueling, confusing, or impossible process. Many give up and spend hours of their take-home money to pay a firm to do the whole thing for them.

Despite all that, it could be worse. Washington state could get an income tax. Then you’d be adding state paperwork to the federal paperwork.

For the past 90 years, ten times in a row, Washington voters have rejected income taxes at the ballot box. But advocates have adopted their own version of the Seattle Mariner’s slogan “refuse to lose.” We keep saying no, they keep trying.

The latest attempt was particularly deceitful in that advocates in the legislature passed what they labeled as an “excise tax” on capital gains. It was an income tax.

Internal emails showed the goal of the legislation was an income tax. WPC’s Jason Mercier contacted the revenue departments of all 49 other states—all of them that have capital gains taxes consider them income taxes because it taxes income. Answering an inquiry from Congressman Dan Newhouse, the IRS confirmed, “it is an income tax.” To calculate the tax, the state would need your – you guessed it—income tax forms.

Thankfully, a Douglas County Superior Court ruling stuck with nearly 100 years of judicial precedent in this state and unequivocally ruled the new capital gains tax is an unconstitutional income tax. The ruling cited WPC’s research and the attorneys seeking to strike down the new law also hailed the research work of WPC’s Jason Mercier as instrumental to making their case.

But once again, they refuse to lose. The State Attorney General’s office’s provided a ballot title and ballot measure summery to the Initiative 1929 campaign that once again, provided the income tax on capital gains with the political camouflage  of an “excise tax” label –this, despite the court ruling making very clear that this tax was clearly an income tax.

So the battle over income taxes in Washington state continues.  Rather than bring an income tax to the people directly, advocates now seem intent on a round-about route. Trying to get the courts to do what the people have refused. But it looks like there may finally be some hope that “no” is a message that can be heard and understood. The Washington Tax Structure Work Group recently voted to REMOVE income taxes from any further discussion. Time will tell what to make of that decision, but it’s a move in the right direction for now.

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Also unfortunate for income-tax fans, Washington Policy Center refuses to lose. WPC will continue fighting against income taxes in Washington state and informing people when income tax advocates try to hide their objectives and sneak one in.

And as most people who’ve had to file state income taxes as well as federal income taxes can tell you, Washington state being income-tax free is a really good deal. (When I lived in Michigan during college, I had to file state income taxes there as well as my federal income taxes—it’s an experience I don’t miss and was shocked the people there put up with it.)

Living in a state without income taxes can even make a big difference in attracting the best players to our favorite sports teams!

So, when you’re done with your federal taxes and you take a deep, satisfying breath that the ordeal is all over, give thanks that you don’t have to sort state income taxes next, and join Washington Policy Center and/or share WPC work with a friend! Help keep the Washington income-tax free!