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Washington State News

Governor’s Office Rejects Fast tax Relief for Washingtonians, Brings up State Income Tax

(The Center Square) – Even as Washingtonians endure high prices at the pump and increased food costs due to record-breaking inflation, Gov. Jay Inslee seems to have no interest in offering people relief, at least in the form of a temporary suspension of the state gas tax or cutting the state’s sales tax or lowering property taxes.

The governor is on record as being against suspending Washington’s nearly 50 cents per gallon gas tax – against pressure from President Joe Biden – claiming doing so would only result in fossil fuel companies enriching themselves by pocketing more profits.

Even before the start of this year’s legislative session in January, Inslee resisted the idea of broad-based tax relief such as a cut in the state’s sales tax or a lowering of property taxes.

“Well, it’s a simple fact that the need for expenditures will go on, but the revenues are going to go away,” Inslee said during the unveiling of his proposed supplemental budget in December. “If those who get stars in their eyes and think that this revenue is continuing to come pouring in is totally unrealistic.”

Since then, revenue forecasts have consistently shown the state bringing in more money than expected. June’s revenue forecast showed a nearly $1.5 billion increase for the current biennium.

At last month’s Economic Revenue Forecast Council quarterly meeting, Rep. Ed Orcutt, R-Kalama, pointed out that revenue forecasts from February 2021 through March 2022 showed a $4.6 billion increase in revenue.

“We’re up another $1.4 billion,” he said. “We’re up by $6 billion in this biennium alone. “Why we can’t look at, you know, some form of tax relief is beyond me.”

The Democratically-dominated Legislature posed no threat in terms of passing tax cuts against Inslee’s wishes during the legislative session. Senate Bill 5897 would have suspended the state’s portion of the gas tax for all of 2022. Senate Bill 5932 would have reduced the state’s sales tax by a full 1%, taking it down from 6.5% to 5.5%. Senate Bill 5769 would have offered property tax relief. None of those bills passed.

The only form of tax relief Inslee seems interested in is the Working Families Tax Credit that goes into effect in 2023.

“There’s no question these are very difficult economic times for many Washington families,” Jaime Smith, the governor’s executive director of communications, told The Center Square via email. “The Legislature has looked at tax relief options and our Department of Revenue is in the process of implementing one of those right now – the Working Families Tax Credit will provide hundreds of dollars directly to hundreds of thousands of families, and that will be an ongoing program, not one-time.”

She offered no direct answer when pressed on how targeted tax relief next year would help people now.

“You asked about options for major tax relief and a program that will distribute $300 to $1,200 to hundreds of thousands of families – on an ongoing basis, not just one time – is one example of what legislators have recently approved,” she stressed.

Meanwhile, plenty of states dominated by Democrats – from Oregon and California to New York and New Jersey and even Hawaii – have either considered or enacted major tax relief policies for residents hammered by the highest inflation in four decades.

When asked why Inslee hasn’t pressed for something similar in Washington, Smith used the opportunity to bring up the idea of a state income tax.

“I don’t think you’ll find any disagreement among legislators or the governor that inflation and gas prices are putting tremendous pressure on a lot of families,” she said. “When you ask about timing of different options, the mechanism for distributing direct refunds the most quickly would be a state income tax, which most other states have but we don’t.”