Governor Jay Inslee proposed a new income tax on capital gains for the upcoming legislative session; a proposal that has failed to advance the past eight (8) years despite Democrat majorities in the state House and Senate. A proposed income tax has also been rejected by the State’s highest court and nine (9) times by voters.

I am a small business owner, and like many small business owners, I am opposed to the governor’s massive “tax and spend” proposal and the tax increases. I believe working families and small businesses deserve a lower tax burden. The Governor is only proposing increases at a time when new taxes are not necessary. The state of Washington is collecting more tax revenue, not less, despite the Governor’s shutdowns.

Peter Abbarno, Representative-Elect in the 20th Legislative District.

Governor Inslee’s proposed budget spends over 10% more than the previous biennium. In the past 8 years, the Governor increased spending over 70%. The Governor’s recent budget proposal creates $4 billion in new taxes, despite tax collections on current sources increasing $3.7 billion over the last biennium.

Article VII of the Washington state Constitution “all taxes shall be uniform upon the same class of property within the territorial limits of the authority levying the tax and shall be levied and collected for public purposes only.” It is unconstitutional to impose an income tax in the state of Washington. The State Supreme Court has struck down the idea of creating an income tax and the voters in Washington have repeatedly voted against a graduated income tax. The Washington State Department of Revenue, State Treasurer’s Office, and Internal Revenue Service define a Capital Gains Tax as a tax on income.

The tax increases proposed by the governor will have a chilling effect on economic development and growth for many small and family owned businesses throughout Washington. As taxes increase, small businesses are stretched even thinner to make capital investments, grow and develop their workforce, and invest in their local communities.

The governor’s proposal would create a 9 percent capital gains tax on earnings over $25,000 for individuals and $50,000 for households; far from the ‘millionaire only tax’ narrative. The governor ignored the needs of working families and small businesses. Rather the Governor’s tax increase only approach, I want to focus on tax relief for working families and small businesses.

Peter Abbarno, Representative-Elect in the 20th Legislative District.