Washington State's regressive tax structure? (sale, insurance, crime)

[Ultrarunner]

So if you were a high end say jeweler… I imagine you are paying quite a lot or say new car and truck sales... profit or not?

[rkcarguy]

Pretty much anything where a majority of your gross sales is "product" not service, will be taxed on the gross sales of that product, regardless of profit. So yeah, car and truck sales, jewelers, building supply, and so on, are a tough business.

[Ultrarunner]

In my California city we pay a gross receipt tax on rents collected... so far I have not found the same in Washington?

A lot of folks that were underwater and trying to hold on decided to rent and were hit hard with the Gross Receipts tax off the top...

[margaretBartle]

Originally Posted by CrazyDonkey

Really? No underwear, shoes, toilet paper, school supplies, over-the-counter medications, computers, cell phones, vehicles? Second-hand stores, by the way, charge sales tax.

https://itep.org/washington/

The lowest 20% pays 13.3% of their income in sales and excise taxes and 4.5% in property taxes. (Note: Even if you rent, property taxes are folded into the rent.)

That said, I'm in favor of a progressive income tax on individuals earning over $200,000 in income (pegged to inflation) if matched one-for-one by reductions in sales and/or property taxes. A major beneficiary of a less regressive tax system would be middle class families.

I bought shoes at yard sales - no sales tax. The othe stuff is a very small percent of the bottom quintile's budget, who generally don't own verhicles or computers. At any rate, how can a 10% sales tax on a small percent of your income equate to a 17% tax rate, unless you are buying very high-tax items like booze and cigarettes, and spending most of your money on them?

[margaretBartle]

Originally Posted by Yeledaf

And now I-1631 may well pass as King County imposes its version of virtue-signaling on the poorer residents of WA.

Sorry for the injection of politics, but as someone on a fixed income, I feel strongly about yet another tax with no purpose but to make wealthy people feel good about themselves while accomplishing zilch. Be assured that the big energy companies will just pass the costs on to consumers. We need to reject this new regressive tax that targets those least able to afford it.

China emits 12747 million metric tons of CO2 per year. Washington State emits 73 million metric tons. Thus, if we were to completely eliminate ALL CO2 emissions in Washington (note that initiative supporters wisely avoid stating any actual goal in emission reductions), that would equal about two days’ worth of China’s pollution. Given the growth in China’s annual emissions, as well as that of India and other major polluters, I-1631 would be swallowed up worldwide in the first minutes of its first day of existence.

It's not just wealthy people who will vote for this Very Bad Idea - I'm shocked at the number of people who think they are voting for Clean Air when they vote for this initiative, which is really just another way to get money from the citizens in another form of a very large, very bad tax.


Not only is is guaranteed to go up every year, but the largest carbon dioxide emiitters are exempt - the Centralia coal-fired plant, the Alcoa smelter, pulp and paper mills AND all those billions of dollars, that will come out of our pockets, will go into a slush fund with no oversight, legislative imperatives, controlled by political appointees.


But it sure feels good to vote for clean air, doesn't it? Even if it makes no sense.

[margaretBartle]

Originally Posted by rkcarguy

I'd support this. The problem is our state simply can't be trusted to implement it and not expand it into all the income brackets. Our last income tax proposal the state tried for, had a "the legislation may modify or expand the breadth of the application of income taxes to the income tiers *without* voter approval".

What about this? I've always thought that something could be done along the lines of a pro-rated tax bracket at the federal level based on the cost of living index for that area. There are people after-all, who make an average to above average pay but due to an area's cost of living index are barely making it. Where-as someone working a 7-11 in a little Midwest town somewhere where housing is super cheap may have a pretty good life.
Why not adjust the tax brackets to suit? For example, someone makes $40k a year in a location that has a 66 COL index(cheap, 2/3rds of the US average), they would be slid up to the $60k/year tax bracket.
Meanwhile, someone making the same $40K in Seattle, where the COL index is 204, shouldn't be taxed at all ($19,608 bracket) and have the opportunity for some assistance.

If you really want to have a tax structure that gets the most money from the people who most benefit from the economy the tax is supporting, we should be taxing wealth, not income. Rich people don't work. Working-class people, almost by definition, are not rich. There are some execptions - the millionaire entertainment and creative stars, the stock-optioned start-up staff, like the McDonald's secretary who got paid in stock options in the early days, but generally speaking, any tax on income is a tax on the least wealthy people.


Remember, the income tax, when it was first proposed, was a short-term tax only to last for the duration of World War I, and was only a tax of 1% on income over $100,000. That would be more than a million dollars in today's money.


Once the tax is in place, then it creeps up and out, charging more money, covering more people.


Don't fall for the argument that it is only taxing the rich. Will never happen that way!

[Ultrarunner]

Originally Posted by margaretBartle

Once the tax is in place, then it creeps up and out, charging more money, covering more people.


Don't fall for the argument that it is only taxing the rich. Will never happen that way!

Sad but so true!

[CrazyDonkey]

Originally Posted by margaretBartle

I bought shoes at yard sales - no sales tax. The othe stuff is a very small percent of the bottom quintile's budget, who generally don't own verhicles or computers. At any rate, how can a 10% sales tax on a small percent of your income equate to a 17% tax rate, unless you are buying very high-tax items like booze and cigarettes, and spending most of your money on them?

Just because you're comfortable wearing other people's shoes doesn't mean most others are.

The bottom quintile definitely do own computers, vehicles, and even their own homes. Property taxes are folded into rent. Increasingly the poor are being pushed out to the far suburbs where they'll often need a car if they want to get to work. If driving a car, they're paying sales/use, excise, and gas taxes. Anything in the supermarket that is not "food" is taxed, whether toilet paper, toothpaste, bath soap, laundry detergent, dish soap, foil/plastic wrap, sanitary napkins, or pet food.

[509]

Originally Posted by Ultrarunner

In my California city we pay a gross receipt tax on rents collected... so far I have not found the same in Washington?

A lot of folks that were underwater and trying to hold on decided to rent and were hit hard with the Gross Receipts tax off the top...

Washington does have a gross receipt tax on rent collected.

There is a 75,000 dollar exemption on sales so it affects relatively few landowners.

[Ultrarunner]

Originally Posted by CrazyDonkey

Just because you're comfortable wearing other people's shoes doesn't mean most others are.

The bottom quintile definitely do own computers, vehicles, and even their own homes. Property taxes are folded into rent. Increasingly the poor are being pushed out to the far suburbs where they'll often need a car if they want to get to work. If driving a car, they're paying sales/use, excise, and gas taxes. Anything in the supermarket that is not "food" is taxed, whether toilet paper, toothpaste, bath soap, laundry detergent, dish soap, foil/plastic wrap, sanitary napkins, or pet food.

Interesting because growing up the poor were stuck in decaying urban/semi-industrial parts of cities... the suburbs were where those with means landed...

It is almost reverse in many areas... the cities are gentrifying and those with scant means often are pushed further out...