The Department of Revenue presented a staff report on wealth taxes to the House Finance Committee on Jan. 14, summarizing international experience and analyzing what administration would require in Washington.

Steve Ewing said DOR surveyed other jurisdictions and reviewed scholarly literature and international practice. The report noted several countries and Swiss cantons currently levy taxes resembling a wealth tax, while others have repealed them. Respondents flagged valuation of nonmarketable assets and tax evasion as primary administrative challenges; reported compliance rates, where provided, ranged from roughly 82 to 98 percent at the national level but the department cautioned those figures are not directly comparable to a state-level proposal.

DOR observed that Washington’s constitutional and tax code structure would likely require treating a wealth tax as a property tax, and that administering a recurrent tax on financial intangibles would require establishing reliable valuation methods (market valuation for listed assets; formulaic methods for nonpublic assets) and additional audit and enforcement resources. DOR concluded it could administer a wealth tax if directed by the Legislature but urged careful statutory design (exemptions, valuation rules, electronic filing and sufficient enforcement resources) because of risks from mobility, evasion and valuation disputes.

Committee members asked about compliance, migration effects and administrative costs; DOR said fiscal and staffing estimates depend on the specific proposal’s parameters and referred members to prior bill fiscal notes for more detail (2023 bills discussed as examples).