Eyman tax initiative takes early lead

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OLYMPIA — A measure seeking to lower the state sales tax unless lawmakers approve a constitutional amendment related to tax increases was leading in early returns Tuesday.

Initiative 1366 is the latest effort by Tim Eyman to limit Washington lawmakers’ ability to raise taxes. It would decrease the 6.5-percent state sales tax to 5.5 percent unless the Legislature approves a constitutional amendment to reinstate a two-thirds legislative majority requirement, which would go to voters on the November 2016 ballot. Currently, taxes can be raised through a simple-majority vote of the Legislature.

The measure was passing in most counties across the state but trailed in King County, the state’s most populous.

In an email Tuesday night, Eyman sent a picture of himself sitting at a computer celebrating the returns, and wrote “Huge victory for taxpayers.”

“It’s time for a vote on a 2/3-for-taxes constitutional amendment to permanently protect taxpayers from Olympia’s insatiable tax appetite,” he wrote.

The measure says that the sales tax cut would take effect April 15 unless the Legislature has approved the constitutional amendment. Any such amendment would face a daunting road to passage, given that many Democrats oppose a two-thirds rule and in order for a constitutional amendment to make it to the ballot, two thirds of the Legislature must approve it. Republicans control the Senate, but don’t have the votes required to pass such a measure. Democrats have a slim majority in the House.

Democratic state Rep. Reuven Carlyle said that the measure “fundamentally amounts to extortion.”

Carlyle said that while voters’ concerns about taxes are a “legitimate and real message,” the effect of having the state sales tax cut would have a significant impact on state resources.

The state Office of Financial Management has estimated the measure would reduce revenue to the state budget by $8 billion through the middle of 2021, if its tax-cut element becomes law.

The state is currently under a contempt order by the state Supreme Court over education funding, and Carlyle said such a cut is “simply unsustainable.”

“If it does indeed pass and the court does not take action it does add a serious level of complexity, no question about it,” he said.

Previous voter-approved initiatives sponsored by I-1366 sponsor Eyman required a supermajority vote on taxes, but the state Supreme Court struck that requirement down in 2013, saying it was unconstitutional.

Meanwhile, Eyman is facing campaign finance allegations after state investigators last month accused him in September of violating Washington election law by misspending campaign funds from a previous measure three years ago, and diverting $170,000 for his personal use. The case has been referred to the state attorney general, who has not yet said what, if any action, the office will take.

Eyman has refused to discuss the most recent allegations, saying that he is focused on the initiative and that voters should “evaluate the initiatives on their merits.”

It’s not the first time Eyman has faced accusations of secretly diverting funds. A 2002 case resulted in Eyman paying more than $50,000 in penalties in fees and being prohibited from serving as a campaign treasurer.