Spin Control: ‘Millionaires tax’ passed but still has several hurdles to clear

Ever since the legislative session ended with the approval of the so-called “millionaires tax,” regular readers of this column might have been wondering something like: “Isn’t that an income tax, which is something you predicted they couldn’t or wouldn’t pass?”

Columnists have a strong tradition of bragging about the predictions they get right and quietly ignoring the ones they get wrong. But in the interests of full disclosure, I have to concede the “millionaires tax” may be an income tax – supporters argued that it wasn’t, although the jury is still out – and if it is, it blew past several of the hurdles I suggested in December would sink it.

Back then, I opined that the Legislature would not be able to scrape together the two-thirds majorities needed in both chambers to pass a constitutional amendment for an income tax, in part because Democrats don’t have such large majorities and in part because the entire House and half the Senate might be wary because of elections this fall.

The “millionaires tax” did not pass with super majorities, and a handful of Democrats voted against it, but because supporters made the claim that a tax on only people with income above $1 million was different from an income tax, they passed it without that requirement.

I opined that Gov. Bob Ferguson, who had said he was generally opposed to a tax increase, wouldn’t sign it if it passed. But Ferguson managed to leverage a possible veto into changes in what the extra revenue would be used for.

The day before he signed it, legislative Republicans sent him a letter urging him to veto it. That was primarily a messaging effort, with about as much chance as if Sen. Patty Murray and the rest of the U.S. Senate Democrats had sent a letter to President Donald Trump urging him not to sign the One Big Beautiful Bill Act.

Now that the bill is passed and signed, the tax might still fail because it must survive a court challenge.

Opponents enlisted a couple of high-powered attorneys – former state Attorney General Rob McKenna and former state Supreme Court Justice Phil Talmadge – to represent them in a lawsuit filed last week. Because the unconstitutionality of an income tax was decided by the state Supreme Court more than 90 years ago, it seems likely that supporters of the tax will lose in the trial court.

A trial judge will pretty much be bound by that precedent if they decide it’s an income tax. Opponents may also be hedging their bets a bit by filing the suit in Klickitat County, which is so red that not only are all the elected county officials Republicans, but no Democrat has made it to the general election for a county office in the last two cycles.

Whatever the trial court decides, an appeal to the state Supreme Court is inevitable.

Before that happens, however, voters might get a chance to weigh in on whether to scrap the tax. As of Friday, there were at least 16 initiatives to the voters with titles like “Repeal the Unconstitutional State Income Tax” and “Don’t Tax Our Income” that could become a vehicle for a spot the November ballot. If none get the required signatures before July, another four proposals have been filed as initiatives to next year’s Legislature.

Supporters of the tax seem to think that even if it is ruled an income tax, the Supreme Court might be willing to revisit that Depression-era ruling and decide that it doesn’t fit with 21st -century Washington. That’s hard to predict, considering the case isn’t likely to make it to the high court before next year, and five of the nine seats on the court are up for election this year.

I could argue that I could be right in the end. But I’m not predicting how any of this will come out.

Pointing out possibilities seems safer than making predictions.