OLYMPIA, Wash. – On Wednesday, state lawmakers introduced a new tax to be paid by the ultra-wealthy, to fund our greatest needs in housing, education, disability benefits, and tax credits for working people. The bills, SB 5486 and HB 1473, would create a 1% property tax that would be paid by only a few hundred multimillionaires and billionaires across the state.
“I know how important it is that we fight for tax justice in Washington state,” said Rep. My-Linh Thai (D-Bellevue), sponsor of the bill in the House. “It’s time we start rewarding work rather than wealth, and build an economy that works for everyone.”
Unlike working people, who hold most of their wealth in tangible property like their homes, the extremely wealthy hold most of their wealth in financial intangible property like stocks, bonds, and mutual funds.
But unlike our homes that are subject to property taxes, there are currently no state or federal taxes on financial intangible property during a person’s lifetime.
“We need to fix our upside-down tax code that rewards the wealthiest few and makes it difficult for working people to pay their rent, put food on the table, and ensure their families have what they need to thrive,” said Sen. Noel Frame (D-Seattle), sponsor of the bill in the Senate. “This is a commonsense bill that ensures that some of the richest people in the world, some of whom live right here in Washington state, pay property taxes on their assets just like middle-class families who own a home pay taxes on theirs.”
If our state lawmakers pass this bill, multimillionaires and billionaires would pay a 1% tax on financial intangible assets, with the first $250 million of such assets exempted. Very few people are wealthy enough to pass this threshold; fewer than 0.01% of Washingtonians would ever pay the tax.
Washington’s tax code is rated the most unfair in the nation for working people, with our lowest income residents paying six times more of their incomes in state and local taxes than the wealthiest.
Additionally, because of our nation’s long history of policies that put non-white people at a disadvantage, communities of color are footing more of the bill for our schools, roads and public services. Meanwhile, our upside-down tax system protects the wealth of the extremely wealthy, which is disproportionately white and male.
“A wealth tax would narrow the racial wealth divide in this state, at the same time as it raises money to invest in affordable housing, rental, and homeownership opportunities,” said Patience Malaba, the Executive Director of the Housing Development Consortium. “I want a world where we can all afford a home and to care for our families, no matter our backgrounds.”
The wealth tax would raise $3 billion dollars per year and would fund public programs we all rely on, like affordable housing, direct cash assistance to working families, care for folks with disabilities, and public education.
“Teachers are on the front lines of fighting for a future world worth living in,” said Julianna Dauble, teacher and president of the Renton Education Association. “The super-wealthy owe more to future generations, and we will not rest until our students are given the chance to realize the promise of public education.”
“Many of the families we serve have kids with disabilities who are denied services because the systems lack funding,” said Ginger Kwan, Executive Director of Open Doors for Multicultural Families. “We need to replace the old tax code with a fair tax system to generate funds for underfunded programs and services. Life shouldn’t be so hard for struggling families.”
Who we are:
The Economic Opportunity Institute is an independent, nonpartisan, nonprofit public-policy center using research, education and advocacy to encourage public debate and advance new policy ideas that help build an economy that works – for everyone.
Balance Our Tax Code is a coalition made up of more than 100 labor unions, non-profits, immigrant rights advocates, human service providers, housing advocates and activists. Together, we work to educate, advocate, shape public opinion, and pass laws until we have a tax code that supports a way of life that works for all of us, not just the wealthy few.
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