Washington's proposed income tax will harm the state's economy and bypass constitutional requirements
Source: Jesse Proudman. "Opinion: The wrong tax at the wrong time for Washington – GeekWire." March 11, 2026. www.geekwire.com
The Gist
The author argues that Washington state's proposed income tax on millionaires is both unconstitutional and economically destructive. He believes it will drive wealthy people and businesses out of the state, eventually expand to tax everyone, and comes at the worst possible time when the tech industry is already struggling.
Conclusion
Washington's proposed SB 6346 income tax is unconstitutional, economically harmful, and will ultimately expand to all residents while driving away talent and capital
Premises
- The tax bypasses Washington's constitutional requirement for income taxes by avoiding the mandated two-thirds legislative support plus voter approval process
- Washington's budget has more than tripled in the last decade, indicating a spending problem rather than a revenue problem that requires new taxation
- Historical evidence shows wealthy residents leave when faced with new taxes, as demonstrated by capital flight after the 2022 capital gains tax
- The tax will inevitably expand beyond millionaires since lawmakers rejected amendments to lock in the $1 million threshold and acknowledged future flexibility
- Washington's tech sector is already weakening due to AI transformation and layoffs, making this the wrong time to impose additional tax burdens
- The revenue projections are likely overstated because the tax base will shrink as high earners relocate to states without income taxes
Assumptions
- Constitutional processes should be followed rather than circumvented through legislative maneuvers
- High earners and entrepreneurs are mobile and will relocate to avoid taxes
- Government spending growth is excessive and should be controlled rather than funded through new taxes
- Economic competitiveness depends significantly on tax policy
- Historical patterns of tax avoidance behavior will continue in the future