Republican budget leader notes progressive property-tax reform now within reach

OLYMPIA… The Senate Democratic 2021-23 operating-budget proposal is expected to become public Thursday, and Sen. Lynda Wilson says she’ll be looking for it to be at least as taxpayer-friendly as the budget Senate Republicans proposed Feb. 11.

“I’m anticipating the Democratic proposal will match ours and finally fund the Working Families Tax Credit that has been on the books for years. The question is whether it also will contain the game-changers for taxpayers we already proposed – ending the upward spiral of the state gas tax, and eliminating the B&O tax on manufacturing – or offer the substantial, progressive property-tax relief we’d include in our budget if it was coming out now,” said Wilson, Republican leader on the Senate Ways and Means Committee.

Wilson had shared Senate Republicans’ budget priorities with her Democratic counterpart earlier this month. Besides the transportation-funding and manufacturing-tax proposals, they include smart investments in services for people with developmental disabilities, and the expansion of broadband access, However, the Republican priorities were set prior to the massive federal stimulus package approved March 11 and this past week’s historically positive state revenue forecast.

“A property-tax reduction was on the board when we were drawing up the Republican budget seven weeks ago, but we couldn’t make it fit. Now that the state’s financial picture has improved by many billions of dollars, the door is wide open to making the first $250,000 of a home’s value exempt from property tax,” said Wilson, R-Vancouver. The “homestead” exemption, as it’s known, is proposed in legislation she introduced, Senate Bill 5463 and Senate Joint Resolution 8206.

“We’re told year after year how our state’s tax system is the most regressive, according to a Washington, D.C. think tank. The income-tax supporters in the Senate cited that when pushing for Senate Bill 5096. But the same think tank also confirms a homestead exemption is progressive property-tax relief. The Democrats could make it happen this year, and I’ve already proposed the policy,” Wilson said. “It’s a fix that can easily be done by the Ways and Means committee.

“If we had held the release of our Senate Republican budget proposal until this week, it would include both the B&O tax exemption for manufacturing and the homestead property-tax exemption, without any offsets. The state’s rainy-day fund wouldn’t be touched, and everything else in our February budget, like maintaining services, would go forward just as we proposed.

“State government’s revenue situation offers zero justification for new taxes. It also supports the Republican belief that now – during a pandemic, when people could really use meaningful tax relief – the state is in a position to let Washington taxpayers keep more of their own money. We’ll know from the Senate Democratic budget whether that’s a bipartisan opinion.”