Opinion: Several tax repeal proposals may be on the ballot in Washington state for 2024

Jason Mercier of the Mountain States Policy Center provides an overview of the tax repeal proposals that will likely be on the ballot in Washington state in 2024.

Jason Mercier provides an overview of the tax repeal proposals that will likely be on the ballot in Washington state in 2024

Jason Mercier
Mountain States Policy Center

Based on the number of signatures submitted, several tax repeal proposals will likely be on the agenda this year in Washington state. A citizen group called “Let’s Go Washington” has submitted six ballot measures that appear to have enough signatures to put the proposals before the Washington state legislature for consideration.

Among these proposals are efforts to repeal the state’s new capital gains income tax (I-2109), put in place a ban on state or local income taxes (I-2111), repeal the environmental cap and trade gas taxes (I-2117), and allow more Washingtonians to opt-out of the state’s long-term care tax (I-2124).

Under Washington’s constitution, there are three possible options with these ballot measures submitted to the legislature:

The legislature can vote to enact without change (this can’t be vetoed by the Governor);

The legislature can do nothing in which case the proposal is placed on the November ballot; or

The legislature can propose an alternative in which case the alternative and original proposal are both placed on the November ballot.

Here is the official ballot summary for each of these tax repeal proposals:

I-2109: “This measure would repeal an excise tax imposed on the sale or exchange of certain long-term capital assets by individuals who have annual capital gains of over $250,000.”

Note: Washington is the only state that refers to a capital gains income tax as an ‘excise tax.’ MSPC has joined a national amicus in a case before the U.S. Supreme Court concerning this tax.

I-2111: “This measure would prohibit the state, counties, cities, and other local jurisdictions from imposing or collecting income taxes, defined as having the same meaning as ‘gross income’ in the Internal Revenue Code.”

Note: Washington voters have rejected 10 straight efforts to impose an income tax.

I-2117: “This measure would prohibit state agencies from imposing any type of carbon tax credit trading, including ‘cap and trade’ or ‘cap and tax’ programs, regardless of whether the resulting increased costs are imposed on fuel recipients or fuel suppliers. It would repeal sections of the 2021 Washington Climate Commitment Act as amended, including repealing the creation and modification of a ‘cap and invest’ program to reduce greenhouse gas emissions by specific entities.”

Note: According to the Washington Policy Center, “The average tax on CO2 in 2023 ended up at $54.74 per metric ton, which equates to about 43 cents per gallon of gasoline and 53 cents per gallon for diesel.”

I-2124: “This measure would amend state law establishing a state long term care insurance program to provide that employees and self-employed people must elect to keep coverage under RCW 50B.04, allow employees to opt-out of coverage under RCW 50B.04 at any time, and repeal a current law governing exemptions for employees who had purchased long term care insurance before November 1, 2021.”

Note: Most Washington workers are currently required to pay 0.58% of their wages in taxes under the state’s requirement to have a long term care policy.

Due to the current political makeup of the Washington state legislature, it is unlikely these tax relief proposals will be adopted by lawmakers meaning voters will likely have the final say at the November 2024 general election.

Jason Mercier is the vice president and director of research at the Mountain States Policy Center.