OLYMPIA, Wash. - Some Washington cities like Seattle have been openly discussing having a city-wide personal income tax, despite the fact that the state constitution prevents cities from doing that. One state lawmaker is trying to open avenues for future implementation.
The idea of a city-enacted personal income tax has been hotly debated, but it can only happen if state legislatures pass a law.
History has shown that the idea of a personal income tax in a state that doesn't have one-- because the constitution doesn't allow it-- is basically only popular with politicians and not taxpayers.
Democratic State Senator Bob Hasegawa introduced SB 5554, which would eliminate "the prohibition on local net income taxes if certain revenue neutrality requirements are met."
"There's some talk that an income tax is unconstitutional, and that's what this gets too," Hasegawa said of the bill.
"The tools in the tool box of local governments are so restrictive that if they want to create services to provide for people who need those services, the only revenue sources they have is to increase regressive taxes, which is taxing those very people they are purporting to serve," he explained.
The Seattle City Council has made rumblings of passing a city-wide income tax, only to expect a court fight. Hasegawa's bill would open the door somewhat, giving authority for any city to pass a personal income tax, but only if the city reduces other city-implemented taxes like sales taxes, property taxes or utility taxes.
"If a city wants to impose an income tax and go through this conversion process by eliminating regressive taxes, then so be it. Let the battle begin on the legal front," Hasegawa said.
However, during an early Thursday morning Senate hearing, Hasegawa's bill appeared to go unnoticed by cities that have been clamoring for authority to impose a personal income tax.
No cities testified for it, and three people testified against it.
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