Yesterday the Seattle City Council voted to adopt an income tax. The Seattle Times reports,
The Seattle City Council unanimously approved an income tax on wealthy residents Monday, a move widely expected to draw a quick legal challenge.
The measure applies a 2.25 percent tax on total income above $250,000 for individuals and above $500,000 for married couples filing their taxes together…
The city estimates the tax would raise about $140 million a year and cost $10 million to $13 million to set up, plus $5 million to $6 million per year to manage and enforce.
The city embarked on this journey back in May, fully expecting the legal challenge and hoping that the state Supreme Court ignore precedent and statute and approve the tax. Former Attorney General Rob McKenna and former state Supreme Court Chief Justice Gerry Alexander wrote in a Seattle Times op-ed in late May,
MORE than 30 years ago, our state Legislature clarified whether cities may tax our income — they may not. State law is clear: “A county, city, or city-county shall not levy a tax on net income.”
Almost 75 years ago, our highest court rejected the idea that the state itself can levy a nonuniform tax on property — taxes applied at different rates to the same class of property, like real estate or income. It cannot…
This proposed measure ultimately will fail.
That sounds right. But based on yesterday’s events as reported in the Times, the politics will be intense. For example,
Supporters of the tax rallied before Monday’s vote, waving signs and cheering.
“When we fight, we win!” they chanted with Sawant, who said more public pressure may be needed.
“If we need to pack the courts, will you be there with me?” she asked.
In Crosscut, David Kroman writes “activists are counting on” the court challenge.
That’s because while the idea of a local income tax is welcomed by many in liberal Seattle, it’s the higher goal of opening up the possibility statewide that has the greatest appeal to its proponents. Seattle’s tax is a grenade, meant to blow up that nearly 90-year-old court decision and clear the way for a reshaping of the state’s tax code.
“We have made no secret of the fact that we’re entering into disputed legal territory,” said Katie Wilson, the lead organizer for Trump-Proof Seattle. “We’ve made no secret of the fact that we don’t expect the city to get revenue for at least a year and a half, pending the court’s decision.
More on the debate in Seattle Met, which reports.
After someone challenges the income tax, the next step is for the bill to go through the King County Superior Court and eventually the Supreme Court…
Several council members made comments about the long-term goal—a statewide income tax—with the city income tax as the first step to getting there.
“This is a big step forward in Seattle, but it’s also a big step forward in our state,” [Council Member Lisa] Herbold said. “In this city, support for tax fairness is increasing, and I hope that that continues throughout the state.”
Seattle Times reporters Jim Brunner and Daniel Beekman discuss the council’s actions in their Overcast podcast. Joining them are John Burbank, income tax proponent and head of the Economic Opportunity Institute, and with Washington Policy Center analyst Jason Mercier, an analyst with the Washington Policy Center, who argues the tax is unconstitutional.