If the city of Seattle wants to constructively help with state tax reform, it should contribute to a broader discussion of what’s needed rather than provoke a court fight.
IF Seattle were in a financial crisis, it might be reasonable for city leaders to call for radical tax reforms.
Washington’s largest city could play a leadership role in conversations about whether the state’s tax system is adequate, dependable and fair.
Or Seattle politicians could put on another circus, leaping over each other and doing back flips to please powerful backers and voters looking for symbolism.
So far the latter is what’s happening at City Hall, where the City Council is expected to vote Monday on a quixotic income-tax proposal.
Despite temptations to tout progressivity on May Day, the council should hold off. Instead, it should consider how to engage in actual reforms now being considered in the Legislature relating to education funding.
Seattle officials have legitimate concerns about tax fairness. They may have an opportunity to demonstrate state leadership and initiate real change, rather than putting on a short-run show for their local audience.
Political groups affiliated with the powerful Washington State Labor Council have cast about for a compliant city to pick a court fight over current income-tax restrictions. They tried and failed last fall in Olympia.
Seattle Councilmember Lisa Herbold began exploring a capital-gains tax in March, then shifted focus to an income-tax. She and Council President Bruce Harrell introduced a resolution Thursday “expressing the city of Seattle’s intent to adopt a progressive income tax targeting high-income households.”
A majority of the council has said it favors an income tax, and Kshama Sawant was working on an income-tax ordinance. The resolution may be voted upon Monday.
This seeped into the mayoral race, where labor will be a key supporter.
Former Mayor Mike McGinn, who voters ousted in 2013 after one term, said he’s running again and favors an income tax.
Not to be outdone, Mayor Ed Murray catapulted over McGinn and the council on April 20, saying he’ll propose taxing the rich.
It’s unclear why Seattle needs an income tax, besides political expediency.
City Hall is awash in cash. Annual spending has grown to $5.4 billion, up 33 percent since 2013. That’s roughly $7,700 per resident; Washington state spends around $5,700 per resident.
Seattle’s timing is terrible. The Legislature is at a critical point negotiating tax reforms as part of its efforts to fund schools. One proposal would “tax the rich” with a capital-gains tax and make the state system more progressive. Another would increase property taxes largely on Seattle residents and business owners.
Seattle’s income-tax plan comes across like a beer bottle thrown onto the field during the ninth inning.
This hurts more than helps their cause.
By shifting from a capital-gains tax to a full-blown income tax proposal, they reinforced the worst fears of those opposing a state capital-gains tax.
Instead of complicating critical state policy work, Seattle should support it constructively.
Thoughtful people such as Seattle economist Dick Conway and King County Assessor John Wilson are trying to start a broader conversation about tax reform.
Seattle politicians should step outside their tent and join the movement.