Washington Voters Weigh $3 Billion Millionaires Tax Repeal in November

Key points

• Initiative 645 seeks to repeal the 9.9% tax on income exceeding $1 million, which is projected to raise over $3 billion annually.
• Opponents argue the tax violates Washington’s historical ban on income taxes and could lead to broader taxation or loss of high-earning residents.
• Supporters maintain the tax is a necessary tool to address fiscal shortfalls and fund education, healthcare, and childcare.
• Legal disputes exist regarding whether the legislature can alter related tax credits after repeal, with the two-year legislative restriction expiring before the tax relief takes effect in 2029.
• The campaign is part of a broader national trend of wealthy donors influencing state tax and education policies, as seen in other states like California and Colorado.

Background

Washington State previously avoided income taxes, making this 9.9% levy on high earners a significant policy shift. The tax was approved by the legislature to address ongoing fiscal challenges. Recent archive coverage notes similar debates in California and Colorado regarding wealth taxes and graduated income structures, highlighting a national trend of states seeking new revenue sources to fund public services amid federal budget pressures.

How outlets are covering it

The New York Times frames the issue as a choice between resentment of the wealthy and aversion to new taxes, noting the tax’s potential to ease fiscal woes. KOMO emphasizes the upcoming voter decision and the ramp-up of campaign ads. The Washington Policy Center challenges claims that the legislature is barred from altering related tax credits, arguing the two-year restriction expires before the tax relief takes effect. The Urbanist criticizes the initiative as part of a broader 'MAGA' agenda aimed at defunding public services and undermining protections for working families and LGBTQ+ students.

Why it matters

The outcome will determine whether Washington State retains a major new revenue source or reverts to its traditional tax structure. A repeal could impact funding for education, healthcare, and childcare, while a retention would solidify a new precedent for taxing high earners in a state that historically avoided income taxes. The decision also has implications for the state’s fiscal stability and its ability to fund public services without raising taxes on lower-income residents.

What to watch

Voters will cast ballots in November to decide the fate of Initiative 645. If repealed, the legislature may have the opportunity to adjust related tax credits in 2027 or 2028, as the two-year restriction on amending voter-approved laws expires before the tax relief takes effect in 2029. Campaigns on both sides are expected to intensify in the lead-up to the election.