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Other Papers Say: State must reduce spending

By Walla Walla Union-Bulletin
Published: June 21, 2020, 6:01am

The following editorial originally appeared in the Walla Walla Union-Bulletin:

It has not yet been decided when the state Legislature will go into a special session to figure out how the state will deal with a drop in tax collections, expected to be about $8.8 billion through 2023.

But that hasn’t stopped state Rep. Frank Chopp, a Seattle Democrat who until recently served as speaker of the House, from pushing for $2 billion in new taxes — including a capital gains tax.

“We can’t simply cut our way out of a recession,” Chopp said in an interview with The Seattle Times. “It’s better to invest in our people and lay the groundwork for the economy and people in the future.”

While we would agree in theory that it is wise to invest in people and lay the groundwork for the future, this situation — an economic collapse spurred by the closing of businesses to reduce the spread of COVID-19 — is an emergency.

The state won’t have the money to cover its bills if the drop in sales tax revenue is as horrific as anticipated.

Emergency action is needed now, and we strongly believe that means the Legislature has to trim spending as soon as possible.

The current two-year budget, which runs through June 2021, is just shy of $53 billion. That was established on the assumption sales-tax revenue would continue to flow into state and local government coffers at a robust rate in a hot economy.

The economy is now warm, but barely. The official projections on tax collections were announced Wednesday, which boosted the loss from $7 billion to $8.8 billion over the next three years. The COVID-19 concerns are still in front of us and the employment rate in Washington, like the nation, has skyrocketed.

Lawmakers must accept that harsh reality. Asking the public to pay more taxes at a time like this feels irresponsible. Beyond that, seeking a capital gains tax makes little sense as it is unconstitutional in Washington.

A capital gains tax — a tax on money that has been earned from the sale of investments and property — is an income tax, which is simply not allowed under the state constitution.

This should not come as a revelation to Chopp or any legislator. It’s long been known that the only way to impose an income tax in Washington is to change the state constitution. It’s been tried 10 times over the past 50 or so years, and it’s been defeated by voters each time.

Trying to hide an income tax by calling it a capital gains tax won’t fool the courts — nor the public.

The Legislature needs to cast aside efforts to raise taxes this summer and focus on reducing spending now so that even deeper cuts won’t have to be made in January when the regular session begins.

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