A Washington State income tax could be on the horizon for some residents. Through initiative 1098 this Washington State income tax could become a reality in the state for the first time, and would increase the tax burdens for what some are calling the “rich” of Washington. Currently Washington State already has a steep sales tax and property tax, and what has afforded the state a selling point when it comes to taxes is the fact that there is no state income tax. In an effort to make more money for the Washington State legislators though, initiative 1098 has made its way to the ballot.
In the voter’s pamphlet for the 2010 Washington State general election, I-1098 is outlines as something that would increase taxes for just certain individuals. The ballot measure states that, “I-1098 would tax “adjusted gross income” above $200,000 (individuals) and $400,00 (joint-filers), reduce state property tax levies, reduce certain business and occupation taxes, and direct any increased revenues to education and health.” It certainly sound like something that could help the lower classes in Washington State, but the debate will be whether it is okay to take from the rich in order to give to the poor.
There has been a lot of debate about what would happen if the legislators of Washington State decided to lower the threshold of an income tax, and decided to drop the number from $200,000 down to something like $50,000 in order to bring in more tax revenue for the state. At the same time, the education system in Washington State is getting cut immensely by the Governor, and that has created quite a few shortfalls at every level of the education system. An income tax like this could generate a lot of additional money that could go directly towards improving the school systems around the state.
Reading into the fine print of the measure, there would be three thresholds of taxable income. For individuals, there would be no state income tax for those earning between $0 and $200,000 per year. For those earning $200,001 to $500,000 they would pay a 5% income tax, and for anyone above that number it would be $15,000 plus 9% of the income above $500,000. Double those amounts if you want to figure out the joint-filing numbers, and then you get a feel for what the new numbers could look like. The estimated total money that could then come into the state would be immense, but the debate still remains about whether it is fair.
Voters get to decide on Tuesday, November 2nd whether this new Initiative 1098 is worth voting for, or if an income tax of any kind is bad for the state.