Washington Democrats push the state income tax as a solution to “sustain needed investments in education.” According to Democrat State Treasurer Jim McIntire, “our tax base has been shrinking for decades” which means our state’s “tax revenue doesn’t grow as fast as our economy and the demand for public services.”
In the Democrats’ world, a state income tax would provide stability.
The problem with the liberals’ reasoning for a state income tax is that — like so many other policies they push — it isn’t based on actual facts.
A recent study shows California’s overreliance on forms of state income taxes — a system Democrats would love to duplicate in Washington – creates economic volatility. According to a “stress test” conducted by Moody’s Investor Service, California’s high dependence on income taxes makes it the “least able big state to withstand a recession.”
Alternatively, Washington and Texas (both non-income tax states) have low revenue volatility and score well in Moody’s budget stress test. In fact, the study found the states of Texas, Missouri and Washington “most prepared for a recession.”
Unfortunately, despite the facts, Democrats continue to be infatuated with creating a state income tax – like one on capital gains – to grow the size of government. And, you can expect them to continue using education funding as an excuse to push their agenda.