GOP legislators propose legislation to ban local income taxes; McKenna says “nothing’s changed” after Appeals Court ruling

Following the surprising Appeals Court ruling striking down a statutory ban on local income taxes, GOP lawmakers propose passing the ban again in the 2020 legislative session. In Crosscut, Melissa Santos reports

The ruling struck down a law the Legislature passed 35 years ago that banned cities and counties from taxing net income, finding it was also unconstitutional.

Now, Republican lawmakers, who have long opposed income taxes of any kind in the state, are looking for ways to make sure that part of the ruling doesn’t stick.

Sen. Steve O’Ban, she writes, wants AG Bob Ferguson to step in.

O’Ban wrote a letter to Ferguson on Wednesday that asked him to intervene in the Seattle income-tax case, which is expected to be taken up by the state Supreme Court.

The other, more direct route, is to pass another law. The legislation would be a simple fix. The Appeals Court struck down the ban saying it failed to conform to the single subject rule. All that’s necessary, then, would be a standalone prohibition.

The appeals court struck down Washington’s ban on local income taxes because of how the original bill was structured. By combining multiple subjects in the same bill, the court ruled, the Legislature violated a constitutional rule that bills cannot embrace more than one subject.

…As such, “it is impossible to assess whether the broad prohibition on net income taxes would have passed without the bill’s unrelated provisions,” the decision said.

O’Ban believes the court ruled in error on that point. So does state Rep. Drew Stokesbary of Auburn, the leading Republican on the House Appropriations Committee.

Nonetheless, both GOP lawmakers said the Legislature could easily pass a stand-alone version of the income-tax prohibition that would eliminate any doubt about that legal issue.

It’s likely to make for interesting 2020 politics.

At the same time, by pushing for a statewide ban, Republicans would be issuing a calculated political challenge to Democrats, who control both chambers of Washington’s Legislature and the governor’s office.

While a tax on income may find some support in liberal Seattle, it is viewed as a less popular proposition in other parts of the state, including some rural and suburban areas represented by moderate Democrats.

For all that, one respected legal analyst says the court’s decision doesn’t change the fundamentals: A graduated income tax is still unconstitutional, as the Appeals Court ruled. MyNorthwest reports,

“Nothing’s changed,” former Washington State Attorney General Rob McKenna told KIRO Radio’s Dave Ross.

For activists, the goal is to eventually get the case before the Supreme Court, with the end goal of getting a full, graduated income tax approved. McKenna, though, doesn’t see that happening.

“This is not to say we couldn’t have an income tax which is graduated, but we have to amend the Constitution to do it,” he pointed out. “That’s been tried half a dozen times unsuccessfully because the voters don’t want it. And the voters have voted against an income tax overall 10 times.”

And, in what might be for many a lower-tier concern, the lack of an income tax appears to be good for hockey.