It looks like Olympia residents will get a chance to vote on a city-only personal income tax.
Northwest Public Radio reports it this way:
Olympia could become the first city in Washington to charge an income tax.
Voters there might see two income tax measures on their ballot this fall.
A group of Olympia citizens is pushing for an income tax, which prompted the city council to write its own proposal.
The money is earmarked for education.
The initiative would impose a 1.5 percent tax on any household income over $200,000.
Some city leaders support the idea, but think the tax should apply to all households. They have voted to write up an income tax resolution in time for the ballot.
According to the Olympian,
In response to a petition that some say is legally flawed, Olympia is pursuing its own proposal to become the first city in Washington with an income tax.
After an intense discussion Tuesday night, the Olympia City Council voted 4-3 to draft an ordinance that would tax all city households — about 20,000 — to create a college fund for local high school graduates. The proposal would go before voters in the November general election.
One major challenge is that the Internal Revenue Service is prohibited from sharing confidential tax information, meaning that the city would rely on taxpayers to voluntarily disclose that data.
“How do I get the information? How do I know who is subject to this tax?” [city finance director Jane] Kirkemo asked.
Another flaw, according to the city, is the inconsistent references to the number of years of college that each recipient would be entitled to under the ordinance. In some places, the initiative’s language says one year, but another line says the fund would pay for the first and second year of college.
City staff also reports that the ordinance lacks a provision for penalties and enforcement in case a household refuses to pay.
Presumably the city ordinance would address some of the administrative problems, but the legality of the measure won’t be determined by the city council.
Mayor Pro Tem Nathaniel Jones made the motion for the city alternative, saying he wanted both to address the initiative’s uncertainties and to make sure that all Olympians had a chance to pay the tax.
Jones said one of his main complaints is that the original initiative unfairly taxes wealthy households.
“I am not pleased with something that taxes people at a certain income level, and people below that line have no obligation to participate,” he said. “We as all Olympians need to participate.”
Hugh Spitzer, a legal scholar who served as vice chair of the Tax Structure Study Committee in 2002, said the effort would not likely pass constitutional muster with the state Supreme Court.
