PHOENIX - Washington State Treasurer James McIntire is proposing a new 5% income tax to fully fund the state's court-mandated K-12 education funding obligations.
McIntire's office announced July 28 that the treasurer had submitted the plan to the state legislature's Education Funding Task Force as a suggestion to fully fund the State Supreme Court's McCleary decision. In that 2012 case, the court found that the state was not meeting a constitutional obligation to fully fund basic education and mandated $4.6 billion of new K-12 funding by 2018. The most recently enacted budget provided $2.7 billion of that.
The task force, a group of eight lawmakers and a non-voting representative of Gov. Jay Inslee assembled under terms of a law passed in February, was charged with finding a way the dependence on local taxes for the state's program of basic education by the end of the 2017 legislative session.
Washington does not have an income tax. McIntire's proposal includes not only creating a brand new flat-rate income tax, but also eliminating the state property tax, limiting local school levies, lowering the business and occupation tax rate, and cutting the state sales tax rate from 6.5% to 5.5%. The income tax proposal includes a $50,000 exemption for a family of four. McIntire's office said the plan would lower taxes for most low and moderate income households.
"Our tax system is the most regressive in the nation," McIntire said in a statement. "Low income households and businesses carry too much of the tax burden in our state. For several decades, our tax revenues have been growing, but not as fast as our economy and the demand for education. As a result, the legislature has shifted more and more of the tax burden to local school levies. We need a comprehensive funding plan to address the education needs that our voters and the legislature passed into law, the constitution requires, and the state Supreme Court has ordered."
McIntire, who is finishing his second four-year term as treasurer, is not running for re-election this year.
The legislature must approve any such plan before it could go into effect. Olympia-based lobbyists have said that education funding is a priority on both sides of the aisle.
