Legislature Sends State Income Tax to Gov. Ferguson After Rejecting Key Taxpayer Safeguards

Washington lawmakers have sent a sweeping state income tax bill to the desk of Bob Ferguson, where the governor must now decide whether to sign it into law or veto it.

Last year, Gov Ferguson signed the largest package of tax hikes in state history into law, after pushing for a “balanced approach” for months.

This year’s income tax cleared the  State House of Representatives after an extraordinary marathon floor session that began late Monday afternoon and stretched for more than 24 hours, setting a new record for the longest continuous House debate in state history. Lawmakers debated the bill, introduced dozens of amendments, and voted throughout the night before ultimately passing the measure with 51 votes (of the needed 50).

The bill was later approved with changes by the State Senate and is now awaiting the governor’s decision.

During the historic debate, House Republicans introduced dozens of amendments intended to address concerns about its fairness and constitutionality. Nearly all were rejected by the Democratic majority. A full list of the amendments and roll-call votes has been compiled by Let’s Go Washington in an online amendment tracker.

Among the proposals that were rejected:

• Letting voters decide whether Washington should have an income tax. The majority of Democrats rejected giving the people a vote, perhaps because voters have already rejected it 10 times.
• Removing the bill’s “emergency clause,” which was inserted to make it far harder to challenge the tax so voters can have their say. Democrats voted to keep it.
• Fixing the bill’s marriage penalty so married couples wouldn’t be treated worse than single filers. That fix was rejected.
• Protecting small businesses with pass-through income from being swept into the tax. Virtually all small businesses operate like this and will be decimated without the change. Majority lawmakers voted no.
• Requiring a vote before the tax could ever expand beyond “millionaires.” Democrats rejected that safeguard.
• Protecting retirees by exempting pension income. Even that exemption was voted down, a surprising move given the Democrat party’s longstanding ties to public-sector unions whose members depend on retirement income.
• Exempting the income of active-duty military service members. That protection also failed.
• Free school lunches. An amendment requiring 5% of income tax revenue to go toward free school lunches lost by 13 votes. This was one of the tenets highly touted by Gov. Ferguson in his March 6 endorsement of the revised bill, and it is not in the bill sitting on his desk.

Taken together, the votes raise serious questions about the long-term reach of the proposal. While supporters claim the tax would only affect millionaires, lawmakers rejected multiple opportunities to permanently limit its scope. Critics warn that means it may only be a matter of time before the tax expands to impact middle-class families, more small businesses, and retirees.

Governor Ferguson has previously said he intends to sign the bill once it reaches his desk. But much more about the legislation — and its potential consequences — has come to light since those comments were made.

If the governor truly intends to address the affordability concerns facing families across the state, he still has the power to stop this bill before it becomes law.

Residents can contact Governor Ferguson now and urge him to veto the income tax bill.

The decision now rests with Governor Ferguson.