Tag Archives: tax policy

Braun heads bipartisan call for veto of new $133 million tax

Governor will block hastily approved tax ‘if he’s consistent’, says budget leader

OLYMPIA… A bipartisan group of high-ranking state legislators today asked Gov. Jay Inslee to veto a new $133 million tax that came out of nowhere to zoom through the Legislature just before its annual session ended April 28.

“This was bad policy to start with, and the fact that it was hustled through in little more than 48 hours makes it even less defensible. That’s not how our state constitution intends for laws to be made,” said Sen. John Braun, Senate Republican budget leader.

Joining him in the veto request are Sen. Mark Mullet, D-Issaquah, who heads the Senate committee on banking; Senate Republican Leader Mark Schoesler of Ritzville; House Republican Leader J.T. Wilcox of Yelm; and Rep. Drew Stokesbary, R-Auburn, who is Republican leader on the House budget committee.

Inslee has until May 21 to veto House Bill 2167, which would effectively double the business-and-occupation (B&O) tax on out-of-state banks; otherwise it becomes law and takes effect July 28.

In their veto-request letter the lawmakers detail how the policy in HB 2167 wasn’t made public until the final Friday afternoon of the 2019 session, yet was through the Democrat-controlled Legislature and on its way to Inslee just two days later. Along the way it bypassed both the Senate and House committees that address policies concerning banks.

They also cite Inslee’s veto of a 2017 manufacturing tax-fairness bill that had moved rapidly through the Legislature. In his veto message the governor wrote that the “tax reductions should be considered in a thoughtful, transparent process that incorporates public input and business accountability.”

“If he’s consistent, the governor will veto this tax increase for the same reason. And in doing so he’ll also protect the taxpayers from any chance of a lawsuit on the grounds that this tax is in violation of the U.S. constitution,” said Braun, R-Centralia.

“It’s as though the majority simply wanted more money to spend and said ‘let’s go after the big banks’ without giving any consideration to the legislative process envisioned by the state constitution.”

Lower B&O taxes for manufacturers proposed to help reverse job losses

A bipartisan group of lawmakers are hoping to revive a reduction in the state’s business and occupation tax for manufacturers and reverse the trend of significant job losses in the sector. The proposal would implement a 40 percent reduction in the tax rate for manufacturers, which passed with overwhelming support during the 2017 legislative session, but was ultimately vetoed by Gov. Jay Inslee.

“Washington’s manufacturing sector has lost more than 50,000 jobs this century,” said Sen. John Braun, R-Centralia, who sponsored and negotiated the 2017-19 budget which originally included the change. “Manufacturing jobs are critical to helping rural and suburban areas experience some of the same economic success urban communities have seen in recent years. We know we can afford this strategic investment since we paid for it in the current budget and are now projected to collect $1 billion more than we expected just seven months ago.”

The legislation phases in a reduction from a tax rate of 0.4840% down to 0.2904% by lowering it 10% annually over four years. That would bring all manufacturing businesses down to the same rate paid by Boeing and other aerospace businesses.

Manufacturing employment is the only sector in Washington to see job losses in the 21st century.  Of the jobs lost, 47,200 have been outside of the aerospace sector.

The new proposal includes a tax preference performance statement which highlights that the change is intended to create and retain jobs, improve industry competitiveness, and reduce structural inefficiencies.

Lawmakers are on day 16 of a short 60-day legislative session scheduled to end March 8.