SEATTLE – Majestic mountains, the Pacific ocean, pristine lakes, serene forests are one reason billionaires reside in the “Evergreen State.” Another is low taxes for the rich, lower even than states like Mississippi and Alabama.
Most of the basic services in Washington State are funded by a “soak the poor” sales tax, a whopping 9.38% when state and local sales taxes are combined. Also hitting low and middle income taxpayers hardest are regressive property taxes, and regressive fees.
There is no graduated income tax. There is no corporate income tax. Thus, low and middle income wage earners pay sales, property and excise taxes at a 15.7% rate while the wealthiest, including corporations like Boeing and Amazon, pay only 4.4% in the same taxes.
Their success in shifting the tax burden to the poor and low income families makes Washington almost heaven for these high rollers. They remember the words of billionaire, Leona Helmsley, during her tax evasion trial in New York: “We don’t pay taxes. Only the little people pay taxes.” That is the modern-day version of “Let them eat cake.”
The concept of imposing taxes according to a person’s ability to pay is deeply embedded in the nation’s political and social values—a platitude mouthed by politicians at election time more than a reality implemented by our government at all levels.
People in Washington State are mindful of the state’s greediest tax cheat, Boeing Aircraft Company, that has reported a total $62 billion in profits since 2002 but paid a pitiful $2 billion in cumulative Federal taxes, an average tax rate of 3.2%. Boeing paid zero Federal taxes in 2013 and claimed $82 million in tax refunds despite reporting $5.9 billion in profits.
Among the biggest
Boeing is among the biggest Pentagon contractors building bombs, missiles, spacecraft, fighter and cargo jets reaping tens of billions in profits at the public trough, many of them not air or space worthy, crashing in flames or developing holes in the fuselage of planes in mid-flight. Boeing has been on the public dole since it was founded.
The federal government built the complex of aircraft plants in Everett, Renton and South Seattle at taxpayer expense during World War II, then turned it over to Boeing after the war. Boeing claims it bought the Renton plant from the Pentagon but does not tell how much—or how little—it paid.
And right now, Boeing is crying poverty, that it cannot pay their 33,000 workers the 40% wage increase they are demanding as they walk their strike picket lines. Yet within hours of the walkout, Boeing sweetened its offer announcing that it was raising the new proposed wage to 30% but remaining silent on its proposal to strip out the 4% annual bonus.
Boeing is a wage cheat and also a tax cheat. The progressive majority in the state is well aware of this backwardness and has acted to make Washington State’s tax code more progressive, i.e. levy taxes according to a household’s ability to pay.
The main reform is the Capital Gains tax, a 7% levy that took effect January 1, 2022 and was first collected April 18, 2023. In its first year, the Capital Gains tax brought in $896 million in revenues earmarked for school construction, child care, and early learning.
The tax is imposed on all non-exempt profits above $250,000 for the sale of stocks and bonds. Only 8,200 households in Washington State have paid this tax since the overwhelming majority of taxpayers own no stocks and bonds.
Yet it stirred outrage among the wealthy—so intense that billionaire Jeff Bezos, Amazon CEO, moved to Florida amid good riddance farewells from his super-exploited Seattle employees.
Hedge Fund multi-millionaire Brian Heywood who moved here from California to enjoy the scenery and zero income taxes founded “Lets Go Washington,” pouring $7,000,000 of his own fortune into hiring signature gatherers to put four initiatives on the November 5 ballot to repeal or cripple measures seeking to tax the rich and provide funds for public schools, health care, public safety, clean air and water and to reduce carbon emissions and save the environment.
Roadsides are befouled with four yard signs proclaiming “Vote YES! Pay LESS” by voting to repeal the Capital Gains Tax—I-2109. The other three are I-2066, repealing the Climate Commitment Act to move the state toward green energy and green jobs while reducing to zero carbon emissions by 2050.
I-2117 seeks to reduce carbon-emitting natural gas in home construction, and I-2124 dismantles the Long Term Care Act, a first-in-the-nation benefit that helps seniors continue to live in their homes after they retire or are disabled. The labor movement, the environmental movement, the senior citizen movement, and all their coalition partners say “VOTE NO! ALL FOUR!”
PSARA (Puget Sound Advocates for Retirement Action) has distributed many thousands of “get-out-the-vote” palm cards that proclaim, “A weird billionaire wants to keep Washington from having what we need: A healthy climate; Funding for Schools; Taxes on the uber-rich; Long term health care; Well paid union jobs…VOTE NO on his ballot initiatives! NO on I-2066! NO on I-2109! NO on I-2117! NO on I-2124!”
The millionaires and billionaires shriek that progressive taxation is a “communist” idea. Redbaiting is a tried and true strategy for blocking even common-sense reforms like the graduated income tax. I know a liar when I hear one. And I also remember in the Communist Manifesto of 1848 it states that the second most urgent reform is “a heavy or graduated income tax.” Thank you Karl Marx and Frederick Engels!
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