Washington Legislature On Collision Course Over Tax Breaks

Feb 26, 2014

The final two weeks of the Washington legislative session may come down to a battle over tax breaks.

Democrats want to eliminate a series of tax exemptions to fund teacher cost-of-living raises and other education priorities. Republicans propose just the opposite; they want to renew several tax incentives with the goal of creating or preserving jobs.

The latest proposal is from House Democrats and mirrors one we saw earlier this week from Senate Democrats. They would tax oil refineries, prescription drug resellers, bottled water and out-of-state shoppers.

Reuven Carlyle, who chairs the House finance committee, says the push to eliminate tax breaks is a direct response to the McCleary case. That Washington Supreme Court ruling says the state isn’t adequately funding education or teacher salaries.

“We live in a post-McCleary era,” said Carlyle, D-Seattle. “The era of old-fashioned stereotypes and clichés of yesterday about more and more, and more tax preferences versus getting smarter and rigorous and investing in early learning — those days are over.”

Democrats would put most of the money from closing tax breaks into funding voter-approved cost-of-living pay increases for teachers. Republicans counter that Washington’s economic recovery is fragile. They believe now is the time to give businesses tax certainty.