Washington state’s tax code allows for over 430 tax preferences which provided $46 billion dollars in savings for various taxpayers during the 1999-01 fiscal biennium. For the most part, tax preferences in Washington are not subject to a comprehensive review process that assesses their effectiveness.
Seven tax preference programs are scheduled to expire in the 2003-05 biennium. Many of these tax breaks were implemented with the goal of improving the local economy by creating jobs. However, there is little data available to assess whether or not they have achieved this objective.
Lawmakers have recently introduced several bills that would automatically extend all or some of these programs, despite a $2.4 billion budget deficit. Extending these tax preferences will cost the state an estimated $94.6 million and local governments $23.8 million in lost tax revenue for the 2003–05 biennium. This amount would increase to $317 million in the 2005-07 biennium.
This loss in revenue needs to be evaluated alongside proposed cuts, including cuts to early education, K-12 and higher education, all of which are key components to a thriving regional economy. In addition, legislators should adopt a system for evaluating the effectiveness of the numerous tax preferences that currently exist.
More To Read
March 24, 2025
Remembering former Washington State House Speaker Frank Chopp
Rep. Chopp was Washington state’s longest-serving Speaker of the House
February 11, 2025
The rising cost of health care is unsustainable and out of control
We have solutions that put people over profits
January 29, 2025
Who is left out of the Paid Family and Medical Leave Act?
Strengthening job protections gives all workers time they need to care for themselves and their families