The legal battle started after the Seattle City Council voted unanimously in July 2017 to adopt the 2.25 percent tax on total income above $250,000 for individuals and above $500,000 for married couples.

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The Washington state Supreme Court has declined to immediately take up the lower-court ruling that killed Seattle’s income tax and is instead sending the case to the Court of Appeals.

The Supreme Court issued the order after meeting en banc Thursday, more than a year after the city petitioned for direct review.

Seattle made its request in December 2017, after a King County Superior Court judge struck down the tax on well-off households, which the city hadn’t yet begun to collect. Rather than appeal Judge John Ruhl’s ruling to the Court of Appeals, the city went straight to the Supreme Court.

Supporters have seen Seattle’s case as an opportunity to break through the long-standing inability of Washington and its cities to tax the wealthy. For them, Thursday’s order could be seen as a setback.

“There’s no way they can look at this and see any silver lining,” said income-tax opponent Jason Mercier, director of the Center for Government Reform at the libertarian Washington Policy Center.

But in a statement, City Attorney Pete Holmes said the city wouldn’t be giving up.

“While we felt the state Supreme Court was the most appropriate forum to address the constitutional issues we hope to resolve in this case, we’re happy to first take our arguments to the Court of Appeals,” Holmes said.

“Whatever the outcome at the appellate court, either side will have the opportunity to petition our state Supreme Court for appeal.”

John Burbank, executive director of the progressive Economic Opportunity Institute, said direct review would have been best because Seattle and other cities need income taxes now. But Burbank said proponents should remain confident.

“We continue to believe Seattle’s income tax on the affluent is constitutional and legislatively permissible,” he said. “Having said that, because the case will seriously impact our state’s tax system, it’s perfectly understandable that the Supreme Court wanted the Court of Appeals to consider this first.”

Matthew Davis, an attorney for one of the Seattle residents who sued over the city’s tax, said he was surprised by the choice to punt on the high-profile case.

The legal battle started after the Seattle City Council voted unanimously in July 2017 to adopt the 2.25 percent tax on total income above $250,000 for individuals and above $500,000 for married couples.

The council, estimating the measure would raise about $140 million per year, promised to spend the money on housing, education and transit and to reduce other, more regressive taxes.

Several Seattle residents almost immediately sued, some backed by conservative organizations, including the Olympia-based Freedom Foundation.

In his Nov. 22, 2017, decision, Ruhl said the city lacked specific authority from the state Legislature to impose the income tax. The judge also said the tax violated a Washington law that bans taxes on net income.

Seattle described the measure as an excise tax and sought to skirt the ban on taxing net income by taxing total income instead. Ruhl disagreed.

The judge didn’t take up the question of whether the tax violated the state constitution’s requirement that taxes be uniform within the same class of property.

Seattle’s case might be considered a longshot. Washington voters have rejected income taxes more than once, and the Supreme Court decades ago ruled that income was property.

At the Supreme Court, Seattle and its supporters hoped to attack that interpretation. A ruling for the city could open the door to statewide changes.

Washington’s tax system has been labeled the most regressive in the country by tax-reform think tanks, meaning low-income people pay a much higher percentage of their earnings than do affluent residents.

And Seattle’s tax system is the worst of any city in the state, Burbank said.

“We have this incredible growth of private wealth but an inability to pay for public services,” he said.

Back in 2017, Seattle agreed to pay an outside law firm up to $250,000 to help defend the city’s income tax.