Initiative 2109

Repeal the capital gains tax

Initiative Measure No. 2109 concerns taxes.

This measure would repeal an excise tax imposed on the sale or exchange of certain long-term capital assets by individuals who have annual capital gains of over $250,000.

Should this measure be enacted into law? Yes [ ] No [ ]

BALLOT SUMMARY

This measure would repeal an excise tax imposed on the sale or exchange of certain long-term capital assets by individuals who have annual capital gains of over $250,000.

FIXING BAD POLICY

Senate Bill 5096 (2021): Created a tax on capital gains income, calling it an “excise tax” instead of an income tax in order to get around constitutional restrictions. Although this current law taxes capital gains of $250,000 or more at a 7 percent rate, Democrats have already introduced proposals that would reduce the minimum threshold to $15,000 and increase the tax rate to 8.5 percent. While former residents like Jeff Bezos can move out of state to avoid current and future iterations of this tax, the best chance for most Washington citizens to protect their personal income from government greed is to see this controversial tax repealed now.

OUR POSITION

  • This initiative would repeal the state’s capital gains income tax.
  • House Republicans oppose the capital gains income tax because it is:
    • A major step toward a new state income tax.
    • Unnecessary. State tax collections are strong and state lawmakers enough revenue to pay for state priorities.
    • Unpopular. Washington voters have told us several times that they do not want any form of a new state income tax.
    • Unstable. This type of tax is volatile, especially in economic downturns.
    • Unconstitutional. Unfortunately, the state Supreme Court disagreed in a controversial decision.
    • Makes our state less competitive. The absence of a capital gain income tax contributed to economic growth in our state – particularly in the technology sector. 
  • Video: House floor debate highlights on SB 5096 – capital gains income tax (2021)

I-2109 AT A GLANCE

INITIATIVE FILED: May 17, 2023
SIGNATURES SUBMITTED: 436,474
SIGNATURES REQUIRED: 324,516
DATE CERTIFIED: Jan. 23, 2024
HOUSE COMMITTEE: Finance
SENATE COMMITTEE: Ways & Means
ACTION TAKEN: None

LEGISLATIVE UPDATE

Rep. Jim Walsh, R-Aberdeen, reviews a Republican attempt to move I-2109 forward in the House.

THE PROPOSED LAW

MOTION FOR HEARING

Rep. Mike Steele, R-Chelan, contends a hearing on I-2109 would statisfy the state constitution’s requirement that initiatives to Legislature take precedence over other non-budgetary policy. View vote count → View vote count →

Note: The ballot title, which appears in the dark gray box, and the ballot summary are supplied by the Office of the Attorney General as the official language of this initiative to the Legislature. Signatures submitted source: Secretary of State