While there is no shortage of regional funding challenges — from education to transportation to homelessness — few politicians are calling for responsible budgeting, the reallocation of resources, or cuts in programs that aren’t working.
Local residents are getting their first taste of property-tax hikes courtesy of Olympia this month and, in many cases, it’s shocking. According to The Seattle Times, a spokesman for the county assessor noted the 2018 boost is “the largest property-tax increase in King County in modern history.” In at least one community — Carnation — homeowners of a median-assessed-value property might see an astonishing 30 percent increase.
While middle-class Washingtonians are paying more taxes than ever, some politicians are laying the blame on the state’s “regressive” tax system. But, as is often the case, proponents of higher taxes cloak a more complete picture of state taxes and spending prioritization with emotional arguments about “inequality and fairness.” Recently, King County Executive Dow Constantine and King County Assessor John Wilson joined the debate, pressing the case in a Seattle Times Op-Ed for tax reform, even calling a proposal for a new capital-gains tax as one of “several innovative ideas.”
Here are some of the hard facts that are currently missing from the “inequality and fairness” debate:
• First, we are flush with revenue. According to the State Economic and Revenue Forecast Council, tax inflows are predicted to grow to more than $48 billion from 2019-2021. That’s a $20 billion increase since the 2010 budget. At the same time, the city of Seattle’s revenues alone have gone up dramatically, driving a 26 percent increase in annual spending over five years.
• Second, if the goal is to reduce the number of regressive taxes hitting Washingtonians, we could start with consideration of the sugar tax, cigarette tax, car tabs, parking taxes and gas taxes. Other than car tabs, no one in elected office has suggested we undertake this review. In fact, the Seattle City Council has been a champion of more regressive taxes, not fewer. Apparently, when it comes to their endless drive for more revenue, the issue of “tax fairness” is no longer critical to solve.
• Third, while there is no shortage of regional funding challenges — from education to transportation to homelessness — few are calling for responsible budgeting, the reallocation of resources, or cuts in programs that aren’t working. Instead of seeking more, we should take stock of what we already have — which is more than ever — and develop sensible spending priorities that address our region’s most pressing needs.
• Finally, it is hard to make the case for insufficient revenues and “regressivity” when faced with the following facts: Washington state tax revenue is growing by hundreds of millions annually and Seattle’s annual tax revenues are up substantially in the last five years. Our three main tax-revenue sources are Washington’s business and occupation tax (hardly a regressive tax), property taxes that are growing with increased property values, and sales taxes which don’t apply to key basic needs and disproportionately affect heavy spenders. And, despite heavy rhetoric to the contrary, not one single elected leader is seriously advocating lower sales taxes or getting rid of other regressive taxes on sugar, cigarettes, cars or gas.
At the end of the day, most politician’s objectives are about accumulating more revenue for government to control, not solving any of our real problems with cost-effective and high-impact policies and programs. All of these new taxes will hurt our unique economic ecosystem that’s creating opportunity for more and more Washingtonians every day — and they will do nothing to reduce tax regressivity. Both Washington state and the Greater Seattle area currently have some of the lowest unemployment rates nationwide, coupled with rapid wage growth and job market expansion. Let’s talk about how we can build on this together.
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