Tri-Citians should counter the Dems’ income tax plans. Kennewick is right to take a stand

Like a never-ending game of whack-a-mole, efforts to impose an income tax in Washington state continue to pop up no matter how many times they’ve been slapped down.

That’s why the Kennewick City Council’s formal opposition to a local income tax is more than just political posturing. It’s an important way to tell state leaders to drop their income tax game plan.

If enough individual communities rise up against just the idea of an income tax, perhaps lawmakers will stop trying to force the issue and instead focus on other tax reforms that would be more acceptable to the general public.

By passing a resolution Tuesday night against local income taxes, Kennewick joins Granger, Battle Ground, Spokane, Spokane Valley and Union Gap in the opposition. Meanwhile, the Yakima City Council is sending an income tax ban charter amendment to its voters in November.

Other cities should add momentum to this anti-tax drive, including Richland, West Richland, Pasco, Benton City, Prosser and Connell. The more who join in the message, the more forceful it will be.

And don’t think an income tax couldn’t be imposed sometime in the future.

In 2017 we cautioned that citizens should pay attention to what was going on in Seattle. In July of that year the Seattle City Council voted to impose an income tax on its wealthiest citizens knowing all too well that it would go to court. Washington’s state constitution prohibits a graduated income tax, and Seattle officials were looking for a way to challenge that.

At the time we wrote: “By spurring debate, advocates for the Seattle income tax hope to reverse historical precedent and open the door so other communities can follow Seattle’s lead. If that were to happen, it’s reasonable to think the next step would be an effort to impose an income tax statewide.”

Jump ahead to 2020 when Washington’s Supreme Court declined to hear Seattle’s case and therefore allowed previous rulings against the measure to stand.

But while Seattle’s plan was eventually stopped, along the way the Court of Appeals struck down a 1984 state law that explicitly prohibits a flat rate, local income tax.

That means city officials who want more money in the coffers can now impose a 1% income tax across the board and it is perfectly legal.

This is why the Kennewick City Council adopted Resolution 21-10: Opposing a Local Income Tax on the Residents and Businesses of the City.

Kennewick officials have no intention of burdening citizens with an income tax and the formal resolution makes that clear.

It’s true the action isn’t binding, and a different city council in the future could override it. But for now, the resolution makes a strong statement.

Earlier this year the Democrats pushed through a capital gains tax and at the same time devised a way to stop voters from repealing the new tax through the referendum process.

The measure imposes a 7% tax on the sale of stocks, bonds and other assets above $250,000 and is being touted as a way to make the wealthy pay their fair share.

Like the Seattle effort, Democrats expected to go to court over the measure in the hope that the ruling would go in their favor and lay the groundwork for a way around the state constitution.

They ended up getting what they wanted.

Two lawsuits — one by the Freedom Foundation and the other by the Washington State Farm Bureau — are challenging the capital gains tax, and both suits are being led by former Attorney General Rob McKenna.

The IRS and past rulings from the Washington state Supreme Court have affirmed that a capital gains tax is really an income tax, which is not allowed under the state constitution.

However, Democrats are calling the capital gains tax an excise tax and hope the current court will agree.

We have said many times that tax reform is needed in Washington state, but skirting the state Constitution is not the way to do it — especially when voters have soundly rejected 10 straight ballot measures that would have allowed an income tax.

Kennewick officials were right to promise citizens they wouldn’t vote for a flat rate income tax. Other Tri-City area communities should follow suit.

This story was originally published September 8, 2021 at 10:25 AM.