OLYMPIA — Senate Democrats may offer voters a choice of which tax they like better: a higher sales tax or an income tax on people making more than $200,000 a year.
With very short notice, the Senate Ways and Means Committee has scheduled a hearing this afternoon on a proposal to do just that. Raise the sales tax temporarily and have an automatic referendum for November. At that time, voters could decide to keep the higher sales tax or repeal the latest increase, plus another half cent on the dollar, and impose an income tax on so-called “high earners” — individuals who make more than $200,000 a year or families making more than $400,00.
Senate Majority Leader Lisa Brown, D-Spokane, broached the idea today on her blog. The committee had scheduled a two-hour hearing to start at 5 p.m., then reset that for a one-hour discussion at 4:30 p.m.
Brown said she sees this as a possible solution to closing an estimated $2.8 billion hole in the state budget with a balance of program cuts and tax increases. But she also supports the concept.
“I would personally feel good about it…I’m not saying it has got to be this way,” she said
To do this, they would have to first substitute this plan for another tax package by Sen. Rosa Franklin, D-Tacoma. Franklin said she supports the income tax as fairrer, and has had many letters and calls from constituents calling for the state to develop a fairer tax system.
“With an income tax, I see more stability,” Franklin said. “It can with stand the downturns better.”
Asked about the short notice for such a significant proposal with a week left to go in the 60-day session, Franklin replied: “Things happen fast around here.”
A Democratic Senate source also noted that while the bill may have to be pushed through at the end of the session, the public will have the summer and fall to decide whether it would prefer the income tax to a higher sales tax. Some Washington Democrats have been pointing to last month’s election in Oregon where voters approved tax increases as a sign the public might accept tax increases and restructuring if given the chance.
But Sen. Chris Marr, D-Spokane, isn’t sure that’s a good guidepost, and while he thinks it’s good to have the discussion on an income tax he does not support the plan.
“I didn’t like the sales tax (increase) and I like the idea of an income tax even less,” Marr said. “I question the willingness of the public to move in the direction of an income tax.”
Sen. Mark Schoesler, R-Ritzville, said bringing the bill up on short notice, near the end of the session, belies any suggesion of public involvement in the process.
“This is not open government, this is government by convenience,” Schoesler said.
Instituting an income tax requires a constitutional amendment, he said. Passing a bill with a bare majority and putting it to a referendum won’t withstand a court challenge.