Where does most of Washington's tax burden come from? (Seattle: flat fee, sales)

[AD1985]

Washington has no state income tax, and the corporate gross income tax seems to be relatively small, although low margin businesses can be hit disproportionately. Yet the overall tax burden for the state is 9.1% of its residents median income, which is about middle of the pack in the US: Release of Annual State-Local Tax Burdens Rankings | Tax Foundation

I can see higher than average property taxes contributing. Where else does the tax burden come from?

[Ruth4Truth]

Sales tax, which in some localities reaches to over 9%.

[strad]

Originally Posted by AD1985

Washington has no state income tax, and the corporate gross income tax seems to be relatively small, although low margin businesses can be hit disproportionately. Yet the overall tax burden for the state is 9.1% of its residents median income, which is about middle of the pack in the US: Release of Annual State-Local Tax Burdens Rankings | Tax Foundation

I can see higher than average property taxes contributing. Where else does the tax burden come from?

Actually Washington has about average property tax rates, just higher than average property values. Sales tax is 4th highest in the nation though. Alcohol tax is highest in the country.

[Gardyloo]

49% of Washington State's revenue comes from sales tax (the state's portion of locally-collected sales taxes). 20% comes from the Business and Occupations tax, and 12% from the state's share of property taxes. A host of other smaller taxes comprise the balance.

Of course there are separate revenue categories for fees and services income sources, federal funds granted (health, education etc.) and a variety of other sources.

In 2012 Washington ranked 35th among US states in terms of per capita state and local taxes levied per $1000 in personal income. Comparative State and Local Taxes

[tifoso]

The big issue for Washington isn't simply the tax burden, it's how that burden is distributed. And according to a recent report from the Institute on Taxation and Economic Policy, Washington state's tax structure hits the poor and middle class far more than it does the wealthy. In fact, by that measure, Washington's tax system is the most regressive in the country.

The main reason for that, of course, is, as Gardyloo pointed out, the state's heavy reliance on the sales tax and other flat fees as opposed to levies assessed by income. Not saying whether this is good or bad (a whole 'nother topic) but simply to point out a recent study of the issue. Which can be found in its entirety here:

Who Pays? 5th Edition | The Institute on Taxation and Economic Policy (ITEP)

[richardalpert]

do you guys think WA will institute a state income tax any time soon?

[tifoso]

Doubtful.

In Nov. 2010, state voters turned down a measure that would have taxed only those earning $200k/year (single) and $400k (married). It went down 65-35 and if memory serves, didn't pass even in relatively liberal King County. That's the seventh time voters have rejected an income tax.

The city of Seattle is currently trying to get around the state prohibition by directing the city law department to figure out if they can levy an "excise" tax (don't call it an income tax!) on those making more than a million a year. I'm not a constitutional lawyer, but I'd bet this proposal would be rejected by state courts.

[richardalpert]

Originally Posted by tifoso

Doubtful.

In Nov. 2010, state voters turned down a measure that would have taxed only those earning $200k/year (single) and $400k (married). It went down 65-35 and if memory serves, didn't pass even in relatively liberal King County. That's the seventh time voters have rejected an income tax.

The city of Seattle is currently trying to get around the state prohibition by directing the city law department to figure out if they can levy an "excise" tax (don't call it an income tax!) on those making more than a million a year. I'm not a constitutional lawyer, but I'd bet this proposal would be rejected by state courts.

good to know!

i honestly don't know if it's better to have a high sales/ property / or income tax (or all 3 in some parts of california)

[Ira500]

An an income tax is the third rail of Washington State politics. It's been before the voters three times, and always loses. Just like Oregon is very unlikely to institute a sales tax. Doesn't matter if it'll make things more fair, or even out bad times. it won't pass, and proponents of it tend to have their political ambitions ended

[wutitiz]

Sin taxes have proven to be popular in WA. We are #1 in alcohol tax and #6 in tobacco tax.
http://taxfoundation.org/sites/taxfo...ax%20Rates.png
Map: Spirits Excise Tax Rates by State, 2014 | Tax Foundation

The tax on newly legalized pot is so high that the black market continues to thrive. There have been several proposals for hefty porn taxes from both Democrat and Republican legislators, which have so far died on the vine, but given this state's track record will be back. There was a tax on candy enacted by the Democrats which was overturned by the voters.