While Washington sits on an over $60 billion budget surplus, taxpayers are petitioning for relief. Analysis shows that broad-based tax relief programs benefit states economically more than taxation. The data makes a strong case for implementing such a policy in Washington, despite hesitation from state leaders. Yet may families are struggling and “affordable living” remains a top political issue.
“While the state has a surplus of money it isn’t sharing with the taxpayers who provided it, increasing inflation is harming workers and their real average hourly earnings,” Washington Policy Center writes. “In addition to increased prices for goods and services, Washingtonians are experiencing government inflation via new payroll taxes for workers that began in 2019 and 2023.”
Numerous bills have been proposed, by Democrats and Republicans alike, but most never even receive a hearing. Everything from a 1% reduction in sales tax to tax relief for workers, homeowners, and businesses have been proposed to no avail.
In 2022, the Seattle Times wrote, “The absence of taxpayer relief in a year of a $15 billion budget surplus — and inflation at 40-year highs — strongly indicates that the current power players simply don’t care to cut. Ever.” With an even larger surplus in 2024, and even higher rates of inflation, that prediction seems correct.
If state lawmakers were truly interested in prioritizing the economic outlook for the state, broad-based tax relief would be in their best interest. Twenty-seven states have proved that.
“The 27 states that cut the rate of a major tax (individual income, corporate income, or sales tax) experienced a 9.8 percent tax revenue increase in real terms between calendar years 2019 and 2023, while states that didn’t cut any of these taxes — or, in a few cases, increased them — saw tax revenues grow by 6.2 percent,” the Tax Foundation found. “The tax-cutting states grew revenue faster with lower rates.”
Oregon even implemented a “kicker tax credit,” which “requires the state to refund surplus revenues to taxpayers when actual General Fund revenues exceed the forecast amount by more than two percent.” Oregon residents are thrilled that the state’s record $5.61 billion surplus will be returned to taxpayers.
At the end of the day, there’s no good reason why Washington leaders shouldn’t consider broad-based tax relief. Residents continue to struggle with high grocery, gas, and housing costs, and state policies aren’t making it any easier. Tax relief would benefit individual taxpayers as well as the state as a whole. There’s no reason to sit on a surplus when it could be put to use helping those who paid into the system.
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