By: Sen. Adam Kline

I’m surprised and delighted that the option of instituting an income tax is finally getting serious consideration in the Senate. I’ve been working to convince my colleagues ever since I arrived at the Legislature twelve years ago that we need to reduce our sales tax and institute an income tax. I’ve written about my support of an income tax here and in several of my past newsletters, which you can find here.

The interest in an income tax has come about because of our current $9 billion revenue shortfall, and the near certainty that we’ll have to deal with yet another smaller but harmful revenue deficit in two years when we create the next biennial budget. Folks are realizing – albeit belatedly – that our system of taxation must be restructured to be more stable, progressive, adequate, and fair, and much less vulnerable to economic downturns.

Some forty-one states have an income tax, and there is no good reason we don't. No good reason -- but there is a reason. In many parts of Seattle, a majority agree that an income tax shifts the burden from those with the least to those with the most ability to pay. But in almost all the rest of Washington, there is no such agreement. So, the reason that Washington, a generally progressive state, is among the nine states without an income tax: we just have an irrational and idiosyncratic opposition to it. Perplexingly, this opposition comes mostly from people who wouldn’t have to pay the income tax.

For example, say there’s a proposal for an income tax of 1% for individuals who make over $100,000. Individuals would pay the 1% just for the amount of income they earn that’s over $100,000. (The first $100,000 for an individual wouldn’t be taxed. Someone who makes $150,000 per year would be taxed just on $50,000. This would equate to $500 in a $500 tax payment each year.) The opposition to this type of income tax comes mostly from people who earn less than $100,000, and who would not be tapped to pay an income tax that was structured to apply only to people who make over that amount. Meanwhile, many folks who earn over $100,000, and who would pay it, are willing to support it. Go figure.

I've introduced several income tax bills over the years, both as the prime sponsor and as a co-sponsor. Last week, we introduced SB 6147. Senator Kohl-Welles is the prime sponsor, and I'm one of six co-sponsors. The bill would create an income tax on those individuals earning over $500,000 annually, and couples (married or domestic partners) earning over $1,000,000. The tax-rate is a flat 1%. About 5% of Washingtonians would end up pay taxes on the part of their income that’s over $500,000.

Personally, I would prefer that the tax burden be placed lower on the income scale (at individuals earning $100,000 and couples at $200,000), and I'd prefer a graduated rate so that the very rich pay a higher rate than the merely quite comfortable, and the very very rich pay even a higher rate. But the bill is a step in the right direction, and by using the higher $500,000 figure, we make it clear that even the super-wealthy escape real responsibility under our current scheme, and just don’t pull their weight.

Our sales-tax-based tax system is the single least fair tax system in the country. Lower and middle class families pay far more than their fair share of the taxes that support the essential public services from which everyone in our society benefits. Currently, those in Washington who make less than $20,000 a year pay 20% of their income in taxes while, those making over $40,000 pay 6%. Lower and middle class families are hard-hit when times are good, and then take a double-hit when times are bad and the state has to slash the programs upon which they depend.

Any proposed income tax will have to go before the voters for their approval via a referendum. If taxes are to be raised, it is the public who will choose to raise them, not just lawmakers.

I’m well aware that just because the majority of people in our district want with an income tax, that doesn’t mean the same sentiment is shared elsewhere in Washington. The chances of instituting an income tax this year are between slim and none, but I’m glad we’re at least making a concerted effort. You can read more about the income tax proposal in Senate Majority Leader Lisa Brown’s blog.