Why Washington needs tax reform:
- Washington’s tax system is upside down. Middle-class and low-income residents pay too much in tax, and the wealthiest pay far less than in other states. Small businesses pay a much larger share of their revenues in state taxes than do the largest businesses.
- Public revenues are unstable and do not grow as fast as the state economy and need for services.
- Quality of public services is slipping. Washington’s rank among the states in per-pupil funding for K-12 education fell from 17th in the early 1990s to 37th in 2006. We rank 37th in awarding college B.A. degrees and 39th in graduate degrees. People are losing health insurance, but budget shortfalls have forced the state to cut the Basic Health Plan by 40%.
Tax Reform Elements:
I-1098 will lower taxes for most state residents. The average homeowner will save $111 annually in property tax. Over 80% of businesses will be exempt from the business and occupation tax (B&O) – retail businesses with revenues up to $1 million and service businesses up to $320,000.A new tax on the wealthiest 1.2% of filers will replace lost revenues and generate an additional $1.58 billion per year.