The Washington state legislature tried to bypass voters this spring when it enacted an income tax on millionaires. Citizens responded by collecting enough signatures to put a referendum on the ballot this fall to stop the levy. New filings show that public-sector employee unions are almost entirely financing the campaign to oppose that initiative.
The Washington Federation of State Employees and the Service Employees International Union, which represents public- and private-sector workers, both gave $1 million to the “No on 645” campaign. The National Education Association chipped in $436,236.
That figures. Government unions have the most to gain from raising taxes. The millionaire tax would lead to more social spending, new government workers and more union dues.
As progressives across America champ at the bit to soak the rich, the people should know that this is what they’re really voting on. Higher taxes don’t necessarily translate into better services. All they guarantee is a more bloated government.
Washington’s referendum is actually very simple. It would define income as “any gain or benefit measured in money derived from an individual’s capital, labor, property, or other source.”
Since 1933, the state Supreme Court has considered income to be “property,” and the state constitution caps regular property taxes at 1 percent of market value. But the court has been pliable in recent years in allowing other new taxes that seem to run afoul of its precedents, such as an excise tax on capital gains.
If voters don’t pass November’s referendum, any household earning more than $1 million a year will face a 9.9 percent annual tax. Initially, this would directly affect an estimated 20,000 households and raise $3.7 billion per year. But it would undoubtedly spur many to change their residency.
The Seattle area incubated great American companies like Starbucks, Microsoft and Amazon, which was founded by Post owner Jeff Bezos. But all three companies have shifted significant shares of their operations and staffing to climates that are less hostile to business.
High earners in Seattle already pay the state’s long-term care insurance tax and the city’s payroll taxes. Combined with federal taxes, the top marginal income tax rate will be 57.9 percent if voters allow the millionaire tax to take effect. That is higher than the top rate in France, Spain or Sweden.
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