It’s been a long legislative session this year, but it wrapped up on April 28. We saw many terrible bills, many of which proposed new or higher taxes that would make your life more expensive.
The good news is that not all of the taxes that were proposed passed. We were able to stop several taxes that would have made gasoline and home heating fuel more expensive without having any measurable impact on our environment, such as a low carbon fuel standard tax. In fact, combined, proposed taxes could have resulted in an increase of about 40 cents per gallon! We also put a stop to an income tax on capital gains.
The bad news is that other taxes managed to get through — taxes that will add up to nearly $2.5 billion over two years, $7.6 billion over four years and a little more than $25 billion over 10 years. (See table above.)
The payroll tax will take 0.58 percent out of everyone’s paycheck.
The property tax allows your local school levy to increase 67 percent.
The B&O tax on services affects over 40 different occupations. (see below)
The graduated real estate excise tax will make apartment rents more expensive during an affordable housing crisis.
The bank tax was steamrolled through the Legislature at the last minute without proper consideration.
The Model Toxic Control Act tax diverts a large portion of its revenue to the state general fund, where it can be spent for any purpose, even if it has nothing to do with hazardous substance cleanup.
The removal of the exemption on sales tax for residents from states that don’t have a sales tax, such as Oregon, will hurt border economies such as Vancouver’s.
Some of the occupations that will see a 20 percent increase
in their business and occupation tax
Newspapers, aircraft manufacturers, dentists, doctors, consultants, lawyers, broadcasters, mail-order businesses, mortgage brokers, unions, lending institutions, architects, cell-phone carriers, outpatient health-service providers, insurance agents, accountants and more. And that additional expense will be passed along to the consumer in the form of higher prices.
REET: Raising taxes on housing when we’re in an affordable housing crisis
Even before session started, I was very vocal about how providing affordable housing was one of our top priorities. One look around our cities will tell you just how hard it is for people to stay in their homes. Rents are too high, property taxes are too high, and efforts to place people are undermined by mental illness and substance abuse.
One of the taxes passed this year that makes the least sense is the graduated real estate excise tax or REET. REET is paid by the seller when a home or property is sold. This year, the Legislature increased the REET paid on properties that sell for $1.5 million and over from 1.28 percent to 2.75 percent. We already had the third highest REET in the country at 1.28 percent!
And while you might not be sympathetic to sellers who are in that price range, you should be aware that many of those properties are multi-family properties such as apartment buildings.
If a buyer has to pay more to compensate for the seller’s higher taxes, that cost will be passed along to you, the consumer, in the form of higher rents. This is unconscionable when the average price of a one-bedroom apartment in Seattle is over $2,000 per month. And that’s not a mortgage — there’s no ownership involved.
How long can our renters afford for prices to rise? I don’t think they can afford it now. And the new real estate excise tax only makes things worse for regular people who can’t afford to buy a home.
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