Income tax

Longview Joins Growing Lists of Washington State Cities Banning Local Income Tax »Publications» Washington Policy Center

Longview City Council unanimously passed a local income tax ban resolution at its October 28 meeting. This means that at least one county and ten cities in Washington have now acted to ban a local income tax, including Battle Ground, DuPont, Granger, Kennewick, Longview, Moses Lake, Richland, Spokane, Spokane Valley, Union Gap and Yakima County. Yakima voters in November will also consider a charter amendment to ban a local income tax.

Excerpt from a summary of Longview’s income tax ban resolution:

“Cities in Washington are taking action to ban a local income tax. The effort comes as state lawmakers this year enacted the first Washington state-wide income tax on capital gains, a bill whose constitutionality is being challenged in court. . Other cities have already acted to prevent a local income tax.

Here is Longview’s income tax ban resolution:

“The imposition of a local income tax on businesses and residents of the Town of Longview is prohibited. Such a tax would be in direct conflict with the high value the City places on promoting economic development through the attraction and expansion of financially healthy family employers. Small businesses are the backbone of our local, regional, state and national economy and it is imperative that the City does not put unnecessary obstacles in the way of their success. As such, Longview City Council prohibits the imposition of a local income tax in the event that a local income tax is deemed legal and authorized by the Washington State Supreme Court or the legislature. of Washington State.

As for the economic benefit of having no income tax, for years the Washington Department of Commerce has made the state’s no-income tax policy a major selling point for its “Choose Washington” job promotion campaign. According to Commerce Department officials:

“We offer businesses competitive advantages that are not found in many other states. It does not include any personal or corporate income tax.

Former Washington State Treasurer Duane Davidson also agrees that the absence of income tax is a significant benefit for residents of the state. At the Washington Policy Center Solutions Summit in May 2019 in Spokane, Treasurer Davidson described the importance of avoiding an income tax and explained why not having one is a positive policy for Washington.

Local governments are passing these bans in response to a surprising 2019 Court of Appeals ruling that opened the door to a 1% local fixed income tax. The state Supreme Court upheld this decision by not hearing the appeal.

Earlier this year, the legislature passed an unconstitutional capital gains tax (while refusing to prevent cities from taxing a local version) with the stated goal of supporters of using the courts to open the door to statewide income tax. Lawmakers also funded budget studies to convince Washingtonians to back an income tax, a taxpayer-funded commission now scouring the state to do the same.

In response to these continuing efforts to impose an income tax, the Herald of the Three Cities The editorial board wrote in September after Kennewick passed an income tax ban:

“If enough individual communities rise up against idea 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. . . Other cities are expected to give new impetus to this anti-tax campaign, including Richland, West Richland, Pasco, Benton City, Prosser and Connell. The more people who join the message, the more powerful it will be. “

Indeed. Other cities and counties should follow suit and signal to citizens and businesses that they will protect their economic competitive advantage by banning the imposition of a local income tax.

Additional information
Washington cities decide to ban local income taxes

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