(The Center Square) – In commenting on a Department of Revenue analysis that Initiative 2109 to get rid of the state’s capital gains tax would blow a $5.6 billion hole in Washington state’s basic education budget, Senate Majority Leader Andy Billig, D-Spokane, referenced the number of households impacted by the tax.
“The capital gains tax is paid by only about 3,300 of the richest households in our state,” he said in a Monday news release, “but all 8 million Washingtonians feel its benefits every day.”
DOR had initially estimated that 7,000 households – the wealthiest in the state – would be affected by the capital gains tax, a 7% levy on gains of more than $250,000 from the sale of financial assets like stocks and bonds.
Mikhail Carpenter, communications manager with DOR, cleared up any confusion over the different figures.
“The 7,000 number comes from the estimate that was done as part of the 2021 legislation,” he explained to The Center Square in an email. “The number in the press release is an actual [number] that probably came from the January update, which had 3,354 returns with payment.”
I-2109 to the Legislature would repeal Washington state’s capital gains tax that went into effect in 2022 and brought in nearly $900 million in its first year, far exceeding original projections.
Washington’s capital gains tax has been in the spotlight recently not just because of I-2109, but also due to Amazon founder Jeff Bezos’ decision to relocate to Miami, Florida, after nearly three decades in Seattle. The move is expected to save the world’s second-richest man more than $600 million in taxes.