House Republicans’ attempt to strip capital gains tax from budget rejected

February 26, 2018

The state House of Representatives is scheduled to vote later today (Monday) on a one-point-six ($1.6) billion dollar supplemental operating budget that would rely on a capital gains income tax. On Friday, House Republicans tried to strip the tax from the spending bill, but their efforts were rejected. John Sattgast reports from the state Capitol.

SATTGAST: Although the capital gains income tax has not yet come to the floor for a vote, House Democrats have booked its revenue into their proposed supplemental state operating budget. If approved, the tax would become effective in 2021 – and Democrats want to use that revenue to reduce property taxes.

But Republican Representative David Taylor of Moxee argued raising one tax to lower another isn’t necessary – that the state already has enough money to pay for reduced property taxes.

TAYLOR: “We have a record amount of revenue coming in to the state of Washington. One-point, roughly, three billion dollars that have come in more than we expected. We can reduce property tax by prioritizing that right now. Make the decision to cut taxes and we don’t have to worry about a capital gains.”

SATTGAST: Kalama Republican Representative Ed Orcutt also argued against the capital gains income tax.

ORCUTT: “Capital gains tax is the most volatile of all the taxes. It will make everything we do here less reliable. So let’s just take it out. Let’s just take that discussion off the table. Let’s use the more stable revenue that we know is coming in. Let’s utilize that to give the property tax relief.”

SATTGAST: The amendment to remove the tax was rejected along party-line votes. The proposed supplemental operating budget bill is expected to come up for a vote in the House later today. John Sattgast, Olympia.