Democrats in Washington Legislature reveal sweeping new tax plan

Washington's Democratic lawmakers have rolled out a comprehensive tax plan to address a looming $16 billion budget shortfall, focusing on various tax increases. Key components include hikes in business and capital gains taxes, new sales taxes on services, and enhanced property tax collections, which together aim to generate nearly $12 billion over two budget cycles. House Majority Leader Joe Fitzgibbon expressed confidence that Governor Bob Ferguson recognizes the need for increased revenue, although his endorsement remains uncertain. Ferguson previously rejected a more aggressive tax proposal targeting individuals with incomes over $50 million, citing its legal challenges. The new plan maintains a focus on wealthier taxpayers and large corporations, with provisions like a surcharge on corporations earning over $250 million annually.

Additionally, it proposes a new tier for the state's capital gains tax, increasing rates on gains exceeding $1 million. The plan also includes a permanent increase in the primary business and occupation tax rate, potentially impacting hundreds of thousands of businesses. Overall, legislators aim to balance revenue generation with targeted spending reductions to sustain essential services.