State Treasurer McIntire Makes Bold Play - Offers Comprehensive Tax Reform to Fully Fund McCleary and Higher Education.
Concerned about the effects of McCleary on our long term
budget outlook and reacting to concerns from the bond market, the State
Treasurer’s office offered a revenue reform package earlier this week. State Treasurer Jim McIntire upped the stakes
in the dueling budget wars by offering a bold, comprehensive state revenue
reform program that would increase the state’s competitiveness, reduce the tax
burden on low and middle income residents, and fully fund basic and higher
The proposal centers on a 5% flat income tax and
stabilization of the B&O tax for retail, wholesaling, and manufacturing
(RWM). B&O rates for the service sector would be reduced by 1/3rd and
RWM would be shifted to the current tax rate enjoyed by Boeing at .29%.
The revenue would also replace the current portion of the state property
tax, cap local levies, and reduce the sales tax from a statewide 6.5% to
5.5%. Unlike previous attempts to create an income tax – this one would
have a voter approved constitutional amendment that locks in the rates,
requiring a legislative super-majority to change them.
According to McIntire, the bond market has been growing more
and more concerned with the state’s judicial mandate of McCleary and the
shrinking tax base in Washington. Since our schools rely on bond sales to
fund capital improvements to our schools, this is a concern that affects every
family in our state. The new proposal would increase the tax base, allow
for steady revenue growth, and add some predictability to future state revenue
projections. For more information, click here.