Special Session Heats Up

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Summer Stinson, one of the originators of Washington's Paramount Duty, went to Olympia this week to testify about the Senate budget bill.  Here's her statement:

I am Summer Stinson, a public school mom and the co-founder of Washington’s Paramount Duty. We named our organization after the constitution’s guarantee of ample, regular, and dependable funding for our public schools.

Past legislatures have operated under the belief that their paramount duty was to keep taxes low on wealthy individuals and large corporations. The result is that children in this state are being denied their constitutional right to an amply funded public education.
We are not here for partisan games. Unfortunately, after the vote that was taken on the floor last Friday, I know better.

Still, this revenue proposal is one that every Senator should be proud to support. This is a great start toward getting full and ample funding to our schools.

The capital gains tax is an excellent proposal — which is why virtually every other state, including Idaho, has one. Their economies thrive with a capital gains tax. Ours will too.

This proposal also begins to close some of the billions in corporate tax loopholes.

Please pass this plan. It’s still not enough. But it’s a great start and we stand ready to help you with more.”
After she finished, he said what you see in the photograph which is rather stunning given her remarks.  It's also strange because voters have every right to question the motives of elected officials -  who they see, who donates to their campaigns, the bills they put forth, who supports those bills, etc.

In listening to the Senator over several years, I have found him to be singularly humorless, uptight and rigid.  

And now, apparently, being a citizen-activist bothers him.  Works for me.

Comments

Numbers Matter said…
The state claimed that 260,000 businesses would experience lower taxes. The state did not provide analysis and the fiscal note was missing. Rhetoric is just rhetoric.


Numbers Matter said…
Capital gains tax is not reliable or dependable.
Anonymous said…
>>>Past legislatures have operated under the belief that their paramount duty was to keep taxes low on wealthy individuals and large corporations.

It's asinine comments and attitudes like this one that insures that pot shot takers will remain ineffective. The senator is absolutely correct that his motives were being questioned. The state needs an income tax if it wants more revenue. Capital gains can be sequestered. Statewide property tax isn't bad either.

Soaked
Lynn said…
Of course his motives were being questioned. The voters in this state would be negligent if they did not consider the motivations of our elected officials/employees when their actions are clearly benefiting the wealthy at the expense of our children and the poor.

An income tax would obviously be much better but our children can't wait for the incompetents in the legislature to get that figured out.
Numbers Matter said…
Does WPD not realize that the city just raised fees on business owners?

Some testified against the capital gains tax. They had good reasons. Increased taxes will be passed to the middle class.

Current proposals will provide Boeing with millions of dollars in tax breaks.

The middle class will pay for McCleary. It is just the way it works.

Motives were being questioned.
Ebenezer said…
Numbers Matter, whether you call it Trickle-Down Economics or Voodoo Economics, the idea that raising taxes on capital gains will hurt the middle class has been thoroughly discredited. Cutting taxes on the wealthy, as well as corporations, has helped vastly increase economic inequality and is helping to wipe out America's middle class. While apologists hate those in power to be held accountable, calling electeds out on their actions is responsible and necessary in a democracy.
Numbers Matter said…
Ebinezer, Tell that to people that will be paying higher fees for child care and other services. Corporations will pass increased costs onto consumers.
Numbers Matter said…
To be clear, Boeing will get a property tax decrease and other large businesses will see a property tax increase. It just depends on location. I am referring to capital gains tax increases.
Interesting fact - most states have income tax and capital gains.
Anonymous said…
Thank you Summer for your continued advocacy for all of our children. I, too, dream of a well-funded public school and hope that one day it will be a reality.

-NW Mom
More info about capital gains in WA state. http://budgetandpolicy.org/schmudget/hedge-funds-vs.-mom-and-pops-the-truth-about-small-businesses-and-closing-the-capital-gains-tax-break
Anonymous said…
Soooo, the biggest capital gain statewide would capital gains on home sales. Are we all going to be happy when we get socked with big taxes after selling homes? It's asinine to decide that someone else's motive is the priority to favor the wealthy. Who are you to assign a motive to someone else? It's perfectly valid to prioritize a vibrant economy. If you characterize the decision more descriptively instead of judgmentally, you're more likely to get results.

Soaked
Anonymous said…
Soaked:

What are you talking about? The capital gains tax would not be on primary homes.

Facts Matter
Anonymous said…
Interesting fact - no state without an income tax has a capital gains tax. Capital gains taxes = income taxes.

Albert
Anonymous said…
Facts, duh. It's a new tax. Are you now proposing an exemption on primary residences?? Why? Because it applies to you? Homeowners are the rich, and surely a lot richer than renters. Let's put our money where are mouths are.

Soaked
Numbers Matter said…
The city of Seattle has just raised fees on businesses. The rate goes up in accordance to income. How is Seattle's B & O tax not an income tax?
Lynn said…
The business and occupation tax is levied on gross receipts not net income. It's not an income tax because business are subject to it whether they make a profit or not.
Soaked, I think you need to separate "homeowners are rich" from "a lot richer than renters." The latter is probably true but the former? I know people who are barely holding on with a mortgage and two incomes.
Raining said…
A capital gain is "income" in those states with an income tax. There is no current capital gains tax in Washington because no income is taxed in Washington.

I believe the court will continue to uphold our constitution and its own precedence and strike down a capital gains tax.

It's not going to happen, and if if it does, it won't produce the revenues so many seem so wedded to.

Numbers Matter said…
I'm not referring to B&O taxes, I am referring to licensure fees, Lynn.
Numbers Matter said…
I should have said: Licensure fees have increased in relation to income. How is that not an income tax?
Lynn said…
License fees increase as a business's revenue increases and are unrelated to net income. Income taxes are taxes on net income. If you run a business in Seattle, surely you must be aware of this difference.
alex said…
The rich are not paying their fair share of taxes in WA. Everyone knows this.

A cap gains tax would exempt primary homes. Would only apply to cap gains profits of more than $50,000 per year per couple. We need this tax. 41 states have it. They figure out how to deal with its fluctuations over time by creating a rainy day fund during boom times. Saying it's not "reliable & dependable" is a red herring, and misses the point. All tax revenues fluctuate over time. We can figure it out.

WA needs a cap gains tax now to get to great schools.
Numbers Matter said…
Split hairs if you must, Lynn. Either way, the city does not charge a flat fee.

Anonymous said…
Well Melissa, maybe those people you know who are house poor need to cash out of their home and live within their means in a more affordable residence. Shouldn't we equally impune the motives of homeowners - who are really trying to amass wealth tax free by using and advocating for tax free exemptions? My point is, homeowners are wealthy, Bill Gates is wealthy, everyone wants to create and retain wealth. We want a vibrant economy as well as a well educated population. People who impune the motives of others on a large issue like this, aren't really credible, and ultimately won't be effective.

Soaked
Soaked, what? How does owning a house impune legislators? I think you are reaching.
Anonymous said…
I love this. alex says, "The rich are not paying their fair share of taxes in WA. Everyone knows this." Maybe alex should have written, "Everyone who is in the activist, progressive bubble knows this."

And here's the thing about the proposed capital gains taxes --- the proposal is a 7% tax on capital gains of $50,000 per year per couple. If the legislature would (in some alternate universe) pass this, it would be 8% on $40,000 in a few years and then 10% on $30,000 in the future. All the while, there would be no relief on sales taxes, business and occupations taxes, or property taxes. In other words, it would be piled on top of current taxes. Plus, it would pertain to "the rich" now, but would eventually be on everyone --- which is really the goal, right? You really want a state income tax --- the tax that our residents have voted AGAINST eight times.

Finally, alex, go look at those other 41 states. All of them have state income taxes. We do not. Capital gains taxes ARE income taxes and are unconstitutional in our state.

Albert
Anonymous said…
Melissa, I'm suggesting that Summer Stinson (and you) needs to crack the whip on all the Seattle residents who are wealthy enough to own homes, including homes worth more than a million- but think the capital gains tax shouldn't apply to them. It should only apply to Bill Gates and a couple others. Let's question their motives in sheltering cash in their homes as you have against the legislature. You could move to Ballard and live in a cubicle.


What about capital losses? Will those count against capital gains, as they do federally. Or will the state provide refunds to residents who incur capital losses? If the state honors carry-forward losses, the state may never see any capital gains.

Soaked
alex said…
Hi, Albert

Since this is a blog for people interested in education, and SPS in particular, and since schools in WA have been shown to be underfunded (see McCleary) how do you propose fully funding our schools?

I'd welcome your ideas, as opposed to shooting down a tax that has the support of 65% of a WA residents--a capital gains tax. You sound unhappy about the potential for income taxes and capital gains tax. I would be happy to pay either, since I believe, with education and human services, you very much get what you pay for.

So, again, it's easy to shoot ideas down, but I'd love to hear your thoughts on where new revenue for schools could come from.
Soaked, and how would we "crack the whip?"Let me know.

What I know is that to fulfill McCleary - without hurting other programs/departments as the GOP plan would - is to find new revenue. That's the Legislature's job.

If people have other ideas, I'm with Alex, let's hear them.
Anonymous said…
alex, before I offer my thoughts on revenue options, I want to address your statement that 65% of WA residents support a capital gains tax. (1) That figure comes from one poll from Public Policy Polling, a firm that is considerably progressive. There's no surprise that they would find favorable results for capital gains taxes in our state. (2) Remember I-1098 --- the initiative to pass an income tax on high earners? It initially polled with 66% support. But that was before there was a campaign and voters heard both sides of the issue. When put to voters, it was defeated by 65% of voters. In other words, I wouldn't be so confident in that 65% figure from PPP.

Revenue options --- A general income tax has little to no chance of passing in this state, so it's off the table. A capital gains can't pass the legislature, would likely fail at the ballot since it's not dissimilar to I-1098, and it's likely to be found unconstitutional (given that it's an income tax). Regardless, a capital gains tax would be tied up in court for several years. So, that leaves property taxes, B&O taxes, sales taxes, and closing of tax preferences as the options.

My opinion is that the "McCleary solution" will involve a combination of options --- as it should --- including a property tax swap, internet sales tax, and a sales tax on soda and bottled water. If retired homeowners could be exempt from any property tax increase, that would be great.

Albert
Well, the Mayor and the City Council already seem to be out in front of this soda tax so that may not work out for Seattle.

And you left out tax breaks for big companies. That, too,needs to be examined. (unless that's what you are calling "tax preferences.")
Anonymous said…
Yes, closing of tax preferences = closing tax breaks. But with that said, there's little to no chance of closing any tax preferences/breaks on big businesses, especially Boeing. That's just not going to happen.

Albert
Watching said…
I wish Seattle's Legislative Districts and voters would question expenditures. The city budget has grown 33% since 2013 Murray's administration has placed an additional 1200 employees on payroll. As well, the voters approved $54M MILLION dollars for prek and the city's prek program will support 1600 students.


I love readers who are just so certain about so many things. Almost like they are insiders, no?

Me, well, I'm just getting older by the minute and have seen things change and turn on a dime so I never say never.
What then? said…
If we get legislation this year that passes McCleary requirements and the Supreme Court blesses it and dismisses the case, what happens if in two years a law is passed rolling back some (or all) of the law?

The McCleary case will have been dismissed. So I suppose a new plaintiff would file a new lawsuit and the process will start again. Right?

The Supreme Court won't keep the case open in perpetuity. That would make them quasi-legislative.

It seems like we should want the statute that is ultimately passes to be written in stone.
Anonymous said…
" I would be happy to pay either, since I believe, with education and human services, you very much get what you pay for."
I completely agree with Alex. Alex I think many people in Seattle, especially those familiar with other states education and other services agree with you. We also need the taxes to tackle the petty crime in Seattle which is off the charts crazy compared to other cities in the US. Tax me please
-KG
What Then, I'll have to relay the debate yesterday at UW Law about the ruling; pretty interesting and pertinent to your thought.
Watching said…
According to State Senator Jamie Pederson, Washington state legislature very likely to be in session two more months.

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