Tax collections tumble again in latest Washington budget forecast

Washington's latest budget forecast reveals tax collections for the upcoming 2025-27 budget will be $490 million lower than anticipated, raising concerns among lawmakers. Governor Bob Ferguson will not call a special session at this time, although he emphasized the need to monitor federal developments that could impact state finances. Both Democratic and Republican leaders acknowledged the potential for adjustments during the next legislative session, which begins in January. The budget, which totals $77. 8 billion, was designed to address a $16 billion shortfall, with projections indicating further revenue declines in future cycles.

The forecast suggests a net decrease of $720 million when factoring in higher-than-expected current budget revenues. Ferguson and other state leaders believe the budget can withstand these negative trends, driven primarily by federal actions. However, dissenting voices within the Republican party attribute the situation to overspending in Olympia. Lawmakers will need to act if the downward trend continues in the upcoming revenue forecasts.