Washington State Supreme Court got it wrong, says Braun

Mar 24, 2023

Court’s ruling ignores overwhelming evidence capital gains tax is an income tax

OLYMPIA…The Washington State Supreme Court today ruled that the income tax on capital gains passed last year by Democrats in Legislature is an excise tax, contrary to overwhelming evidence that it is a graduated income tax. Graduated income taxes are unconstitutional in Washington state.

Senate Republican Leader John Braun, R-Centralia, provided the following response:

“The Supreme Court got it wrong with today’s ruling that a capital gains tax is an excise tax. Washington is the outlier. Every other state and the IRS say that a capital gains tax is, without a doubt, an income tax. The good news is that the Court did not overturn the 1930s ruling that a state income tax is unconstitutional. We are still protected from that, for now.

“That said, Democrats have a strong appetite for a full statewide income tax, which Washington voters have rejected 11 times, and this will feed that appetite. They don’t seem to care about what the people want. If they listened to the people, they would cut government spending and provide meaningful tax relief.

“Democrats often claim that any capital gains income tax, or future state income tax, would only affect the ultra-rich. But if they succeed in passing a full income tax after this, we will see it expand to apply to the middle class as well. Democrats sponsored a bill this session that would have expanded this capital gains tax already, and they haven’t even collected a dime of it yet.”