OLYMPIA — The governor’s office has indicated for awhile it’s leaning toward closing certain tax breaks to meet a state Supreme Court demand to pump more money into education.
But Democratic Gov. Jay Inslee made his strongest case yet this session on TVW Wednesday morning.
“We clearly need to make significant investments that have been ordered by the state Supreme Court. We will make a proposal on how to make a downpayment on that this year. We’ll be proposing closing some tax loopholes to make a downpayment in that regard instead of general tax increases on people,” Inslee said. “We think it’s better to have fairness in our tax system.”
When the TVW interviewer suggested that wasn’t what he said when he ran for office, Inslee strongly disagreed.
“It’s exactly what I said during the election on about 100 occasions from day one,” he said. “I was very clear that the way we should move forward to fund our schools and improve our education is rather than from general new taxes we ought to in fact close some of these illicit, unwarranted, obsolete, unfair corporate loopholes that are putting the burden on regular consumers and people going to work rather than corporations that ought to be picking up their fair share.”
Inslee did talk repeatedly during the campaign about scrutinizing special business tax breaks but was vague about which exemptions he might target. He did not mention specifics on Wednesday.
The governor’s office is expected to come out with a budget proposal later this month, around the time that the GOP-led Senate comes out with its plan for closing a roughly $1 billion — and possibly larger – shortfall, as well as meet Supreme Court demands for education funding.
State lawmakers have often talked about getting rid of tax breaks to raise money, but have never succeeded.
I wrote last year about a tax break the Legislature approved more than 70 years ago that provided a property-tax exemption for out-of state-municipalities that own airports in neighboring Washington. No such thing exists anymore.
A state review panel in 2009 recommended it be eliminated. Yet that tax exemption still exists, along with several others the panel suggested ending, including millions of dollars in tax breaks on certain interstate-commerce activities, and a special property-tax exemption for nonprofit orphanages.
Theoretically, eliminating tax breaks should be easier this year because it no longer takes a two-thirds vote in the state House and Senate to increase taxes, or eliminate tax breaks. The state Supreme Court earlier this month overturned a law requiring supermajority votes to increase taxes, ruling it unconstitutional.
Even so, anybody who benefits from current tax breaks can be expected to show up in force if the lawmakers try to get rid of them. That’s why those efforts have stalled in the past.