Poll finds skepticism about future of proposed state income tax




Posted on September 22, 2010 at 4:51 PM

Updated Thursday, Sep 23 at 10:45 AM

Which statement best reflects your view on I-1098?

SEATTLE – One of the initiatives Washington voters will be asked to decide on this November is Initiative 1098 to start a new state income tax. Supporters say only the wealthy would pay the tax, but one of the key arguments from opponents is that this would open the door for the legislature to someday extend an income tax to more Washington residents.

A new state income tax would raise $2 billion to $3 billion every year. Some of that money would be used to reduce property and business taxes and some of it would go to education and health care.

I-1098 sponsor Bill Gates Sr. admits that down the road, lawmakers could change where the money goes and who pays it, but he believes voters won't let that happen.

"Only the wealthiest 1.2% will pay more," say supporters of the tax in their first TV ad.

The tax would kick in for any income an individual makes over $200,000 or that a couple makes over $400,000. There would be a five percent state income tax on top of your federal income tax. Anything an individual makes over $500,000 (or $1 million for couples) would be subject to a nine percent state income tax.

The bet is that voters who make less than that would be inclined to vote for the tax if they know they don't have to pay.

"People of this state will recognize this makes all kinds of sense for the most important things the state has to do," said Gates.

"There's not a single state in the union that has an income tax that starts at $200,000.  Next closest is Connecticut that starts at 13," said I-1098 opponent Joe Barer.

Opponents say the legislature will be tempted to expand the tax, which the law says it could two after two years with a simple majority vote.

In a KING 5 poll conducted by SurveyUSA, 89 percent of respondents think it's very likely or somewhat likely that a state income tax would be extended to those earning less than $200,000. But Gates says if lawmakers try that, voters will step in.

"I don't think there'd be any difficulty whatsoever in gathering signatures for a referendum and overruling it," said Gates.

Gates is on record supporting a state income tax for all income levels, but he says that's not what is being asked of voters here.

The bottom line is the Legislature can, and does, change initiatives after two years. Whether that would happen in this case would probably depend on how bad the state budget is and the politics of expanding an income tax.