Stevens warns vicious taxing cycle could collapse state’s economy
OLYMPIA…In response to today’s Senate passage of the largest tax increase in Washington state history, Sen. Val Stevens, R-Arlington, offered a warning about the long-term effects of soaking businesses and taxpayers for almost $3 billion more over the next three years while they struggle to survive during the recession.
“The more the state closes legitimate tax incentives, the more small and large businesses will flee this predatory policy by leaving the state. As businesses leave, fewer people will be employed, which will result in less revenue. That puts an even greater burden on the state to extract yet more revenues to help the newly unemployed, which means closing more so-called ‘loopholes.’ This vicious cycle ends when ever-higher taxes result in ever-lower revenues and the state economy collapses.”
Substitute Senate Bill 6143 contains 21 separate tax changes, including a hike in the general sales tax, an increase in the business and occupation tax on 40 different services and the loss of many tax incentives that help Washington employers be competitive. It passed on a 25-23 vote. Passing 29-19, Senate Bill 6874 would increase the state tax on cigarettes by a dollar per pack, to $3.02 in tax alone. Both bills now move to the House of Representatives for consideration.