Income

Governor’s office rejects quick tax relief for Washingtonians, raises state income tax

COURTESY PHOTO
Governor Jay Inslee

By BRETT DAVIS
CENTER SQUARE STAFF REPORTER

(The Center Square) – Even as Washingtonians endure high prices at the pumps and rising food prices due to record inflation, Gov. Jay Inslee appears to have no interest in offering relief to people, from less in the form of a temporary suspension of the state gasoline tax or the reduction of the state sales tax or the reduction of property taxes.

The governor is officially opposed to the suspension of Washington’s gasoline tax of nearly 50 cents per gallon – against pressure from President Joe Biden. The governor says that would only allow fossil fuel companies to get richer by pocketing more profits.

Even before the start of this year’s legislative session in January, Governor Inslee resisted the idea of ​​sweeping tax relief like a reduction in the state sales tax or lower property taxes.

“Well, it’s a simple fact that the need for spending will continue, but the revenue will go away,” Governor Inslee said when unveiling his proposed supplementary budget in December. “If those who have stars in their eyes and think that those revenues keep coming in, that’s totally unrealistic.”

Since then, revenue forecasts have consistently shown the state bringing in more money than expected. The June revenue forecast indicated an increase of almost $1.5 billion for the current biennium.

At last month’s quarterly meeting of the Council of Economic Revenue Forecasts, Rep. Ed Orcutt, R-Kalama, pointed out that the revenue forecast from February 202 to March 2022 showed an increase of $4.6 billion.

“We made another $1.4 billion,” he said. “We grew by $6 billion in this biennium alone.

“Why we can’t consider, you know, some form of tax relief is beyond me.”

The Democratic-dominated Legislature posed no threat in terms of passing tax cuts against Governor Inslee’s wishes during the legislative session. Senate Bill 5897 would have suspended the state’s share of the gasoline tax for all of 2022. Senate Bill 5932 would have reduced the state sales tax by 1%, increasing it from 6.5% to 5.5%. Senate Bill 5769 would have offered property tax relief. None of these bills were passed.

The only form of tax relief Governor Inslee seems to be interested in is the Working Families Tax Credit which will take effect in 2023.

“There is no doubt that these are very difficult economic times for many families in Washington,” Jaime Smith, the governor’s executive director of communications, told The Center Square via email. “The Legislative Assembly has considered options for tax relief, and our Department of Revenue is in the process of implementing one of them at this time. The working families tax credit will provide hundreds of dollars directly to hundreds of thousands of families, and it will be an ongoing, not a one-time program.

She offered no direct answer when asked 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 once – is an example of what the lawmakers recently approved,” she said.

Meanwhile, many Democratic-dominated states — from Oregon and California to New York and New Jersey and even Hawaii — have considered or passed major tax relief policies for residents hammered by the highest inflation in four decades.

When asked why Governor Inslee hadn’t pushed for something similar in Washington, Smith took the opportunity to bring up the idea of ​​a state income tax. “I don’t think you’ll find any disagreement between lawmakers or the governor that inflation and gas prices are putting tremendous pressure on a lot of families,” she said. “When you ask about the timing of the various options, the fastest mechanism for distributing direct refunds would be a state income tax, which most other states have, but we don’t.”

Brett Davis covers Washington State Government for The Center Square.