Washington House passes income-tax substitute after marathon debate; final vote 51-46

The Washington House approved a gross substitute to Senate Bill 6346 after an extended day-and-night session that included long debates over constitutionality, administrative costs and protections for pensioners.

The final roll call recorded 51 yeas, 46 nays and one excused, and the clerk declared the engrossed substitute passed. Supporters said the measure is structural tax reform needed to pay for K-12, child care, Medicaid reimbursements and an expanded Working Families Tax Credit; opponents said it was rushed, would be subject to legal challenge and risked capital flight.

"As a state, we are struggling to fund these vital services," Representative Berg said in closing remarks in favor of the bill. "This millionaires tax ... is a way to change that and ensure that all Washingtonians are able to live here for the reasons I chose to live here." (Representative Berg)

Backers repeatedly framed the bill as targeted: it taxes income above $1,000,000 while phasing out or reducing several regressive levies and expanding targeted credits. Supporters also highlighted provisions to exempt essential grocery items, diapers and over-the-counter medicines from sales tax and to increase small-business credits.

Opponents centered their criticism on two themes: constitutionality and downstream effects. Multiple speakers invoked the state constitutional precedent that has historically constrained income taxation in Washington. "It goes back to the 1933 Cullerton Supreme Court case ... [which] found that income is property," Representative Fitzgibbon said during debate, urging judicial review of novel tax design and caution on proceeding without a constitutional amendment. (Representative Fitzgibbon)

Many members also warned the policy could erode incentives for investment and drive taxpayers and businesses to neighboring states. Representative Connors said she had constituents already considering moves across state lines because of the cumulative tax burden.

Several amendments were decisive in shaping the final bill. Notable floor votes included: - Amendment 25 51 (an unusual provision that would have delayed the statute until an NBA franchise returned to Seattle) was rejected by the House (reported 37 yays to 56 nays). - Amendment 25 63, calling for study and clearer reporting of the administrative costs of a new statewide income tax, passed overwhelmingly (93 yeas, 0 nays, 5 excused). - Amendments to cap Department of Revenue staffing and to enshrine protections for public pensions were offered and defeated after floor debate.

Proponents argued some of those votes reflected a balancing act: the House rejected measures they said would hamstring implementation while accepting others meant to increase oversight. Representative Dye, in support of Amendment 25 63, cited a fiscal note that showed a large administrative obligation and asked for clearer cost estimates before full implementation. (Representative Dye)

The debate on the floor also featured repeated calls to let voters weigh in. An amendment to route changes to the state constitution and require voter approval failed by roll call; proponents said constitutional questions of tax uniformity warranted going to the public.

The bill drew sustained public attention on the floor: speakers on both sides appealed to constituent concerns about affordability, business climate and long-term fiscal stability. Representative Penner and others warned the $1,000,000 standard deduction in the text could be changed by a future legislature and urged statutory safeguards; sponsors said the statutory design was deliberate to target the very wealthiest.

With passage, the bill will move through the enrollment and transmittal processes. Supporters say it creates near-term funding for child care, school meals and other programs while directing revenue reforms to reduce regressivity. Opponents said the measure will face legal scrutiny and risk economic consequences.

The House adjourned and will reconvene at the time and date scheduled in the journal. The immediate procedural next steps are completion of engrossment and transmission to the Senate or the governor as applicable.