Washington’s capital gains tax survives repeal effort

In a significant electoral decision, Washington voters have overwhelmingly rejected Initiative 2109, which aimed to repeal the capital gains tax established in 2021. This tax levies a 7% charge on profits exceeding $262,000 from the sale of long-term assets, excluding real estate, and is designed to bolster funding for essential public services, including education and childcare. The rejection, with 63. 2% voting against the repeal, underscores the importance of this revenue stream in maintaining state services. Supporters of the tax argued that its removal would result in serious funding shortfalls, potentially draining an estimated $2.

2 billion from the state budget over the next five years. The capital gains tax has been contentious, with opponents labeling it a hidden income tax that could drive wealthy individuals out of Washington. However, advocates emphasize its role in making the state's tax system more equitable for lower-income residents. This initiative was one of four on the ballot this year, highlighting the ongoing debate around taxation and state funding in Washington. The outcome reflects a clear preference among voters for maintaining funding for vital public services.