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Dear Friends and Neighbors,
As we enter the final weeks of the 2025 legislative session, Democrats in the House and Senate have recently released comprehensive new tax proposals that will impact everyone in Washington. Ranging from $15 to $20 billion, if either House or Senate Democratic proposals is enacted, it would be the largest tax increase in Washington state’s history.
These proposals include multiple tax and fee increases. The major components of the majority’s packages include a new business and occupation tax surcharge on large businesses, a property tax increase, a new payroll tax, and a new tax on unrealized capital gains.
House Bill 2045 would impose a new Business and Occupation (B&O) tax surcharge on large businesses and financial institutions, which would negatively impact approximately 400 businesses statewide.
Negative Impact: This would affect everyone, as businesses will likely pass these additional taxes on to Washingtonians, making life less affordable, putting loans further out of reach, and discouraging economic growth.
House Bill 2046 would create a new tax on unrealized capital gains for individuals, such as stocks, bonds, mutual funds, and index funds with an assessed value over $50 million.
Negative Impact: This would stifle innovation and investment in Washington, causing entrepreneurs to leave or not come to our state. When wealthy people leave, we lose tax collection revenue. Jeff Bezos left after our state enacted a capital gains tax.
House Bill 2049 would increase property taxes by lifting the annual growth cap from 1% up to 3%, based on inflation and population changes.
Negative Impact: Affordability is a huge issue in our state, and Washingtonians already pay high property taxes. These increases would push more people out of their homes, prevent more people from purchasing homes, and be passed along to renters. This would make the affordable housing crisis even worse.
Senate Bill 5796 would establish a new payroll tax for employers with annual payroll expenses exceeding $7 million.
Negative Impact: This would increase costs for nearly 5,300 employers in our state and negatively impact future job growth.
I strongly oppose these new taxes. They will lead to fewer jobs, higher cost of goods, and more expensive housing at a time when Washingtonians can least afford it.
Senate Republicans have proposed a balanced budget that includes no tax increases or service cuts. The $ave Washington approach is a better way to support the priorities of all Washingtonians, including full funding for K-12 and services for our most vulnerable neighbors, without asking working families to pay more.
I want to know what you think. Do you approve of these taxes? How do you think they will impact you? Please take my survey and share your opinions about these tax increase proposals. You can click here to access the survey from my website or click on the image below. Thank you for the feedback.
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I appreciate your ongoing support and interest in our state government. Please continue reaching out. It’s an honor to serve you.
Sincerely,
Stephanie McClintock
