The strange thing about Governor Gregoire’s rush to re-enact I-747 by calling the Washington State Legislature into Special Session this Thursday is that according to figures from the Washington State Department of Revenue, Washington State’s Property Taxes are below the national average.
In 2004 Washington State ranked 28th in property taxes paid at $31.68 per $1000 of personal income. The national average was $34.75.
In 2005, according to a press release by the Dept of Revenue,”Washington also fell below national averages in property taxes. Property taxes dropped by $1.08 to $30.60 per $1,000 of personal income in Fiscal Year 2005, although Washington’s ranking among the states remained at 28th, the same as in Fiscal Year 2004. Washington ranked 24th in property taxes per capita at $1,055 in Fiscal Year 2005, down from 22nd in the 2004 rankings.”
These figures are surprising and contradict statements by Tim Eyman that would have you believing that we were drowning in taxes. Eyman talks about the need “to protect taxpayers from our obscene and unsustainable property tax burden“. To Tim of course, every tax is obscene and a burden.
The Washington State Department of Revenue’s press release noted that “Washingtonians pay less state and local tax relative to their incomes than residents of 36 other states…”
They stated that, “Tax experts believe measuring taxes against income is the most meaningful comparison because it reflects both ability and willingness to pay taxes for desired governmental services. “
Even Governor Gregoire issued a press release at the time. “Washington ranked 37th nationally, paying an average of $105.91 in taxes for every $1,000 in personal income in Fiscal Year 2005, compared to a national average of $112.94. Washington ranked 29th in Fiscal Year 2004.”
These tax figures for Washington also need to be considered in relation to the fact that 43 of the states also have an income tax to raise revenue, which Washington State doesn’t.
The Governor and the Legislature need to keep these facts in focus before permanently enacting I-747 again.
The issue is one of tax fairness – the Washington State Budget & Policy Center notes that “lower income homeowners pay a much larger share of their income in property taxes (6%) than higher income homeowners (2.8%).
Across the board tax reductions like I-747 do not change the regressivity of Washington State’s tax system. The Legislature needs to looks at circuit breaker and homestead exemption legislation as ways to help reduce the burden on lower and middle income tax payers and should only enact I-747 with a provision that it sunset when legislators enact a fairer property tax system than the current one.
It’s time to look at some new ideas to address tax fairness and quit recycling old ones that fail the test of helping those that need help the most in paying property taxes.
And its time to accept that overall taxes in Washington state, while the most regressive in the country because of their over reliance on sales taxes and property taxes and no income tax, are actually pretty average compared to other states. If we can just relieve some of the burden placed on lower and middle income taxpayers, then we would have a much fairer system.
