Local Businesses Share Feedback on Proposed Tax Increases

The Washington State Legislature is rapidly approaching the end of the session, but has not yet finalized a budget. Faced with a shortfall of $10-12 billion, they are heavily focused on implementing the largest tax increases in Washington State history, despite already doubling tax collections over the last 10 years. For more on these taxes please visit ​People for an Affordable Washington.

​New and increased taxes could include a jobs tax on pay, a business tax on gross revenue, a property tax on homeowners, and more. We know that these taxes will stretch the budgets of residents and businesses. Furthermore, most taxes on businesses get passed along to customers and employees.

To better understand how Pierce County businesses would respond when faced with new tax hikes, we surveyed businesses at the beginning of April. Over 40% plan to reduce payroll in response. This means fewer jobs, fewer hours, and fewer raises for workers.  Another 30% plan to increase prices, effectively passing on the costs to consumers. A handful of businesses also planned to postpone investment or even move operations out of Washington State, something we’ve seen with businesses in other communities that have implemented significant business tax increases.

The proposed tax hikes could not come at a worse time for business. Not a single business said they were “very confident” with the economic stability of our region, while a whopping 83% said they were “not confident.” This highlights the economic uncertainty felt as a result of a rapidly changing economy. Additional tax hikes under these conditions are clearly the wrong answer.

When we asked businesses how the State Legislature should solve the budget shortfall, 74% said solutions should be focused on reducing services to cut spending. This compares to the 7% who felt the solution should be focused on increased taxes. 

Please let your legislators know the impact of the taxes on your business before they adopt the budget. Find their contact information here.

CONTACT LEGISLATORS