Washington state voters on Tuesday overwhelmingly rejected an attempt [election results] to institute an income tax, with over 65 percent of the electorate voting against the initiative. Initiative 1098 [text, PDF] endeavored to establish a tax on those with incomes above $200,000, and those filing jointly with incomes over $400,000. In return for this, the initiative would have reduced the limit on statewide property taxes by 20 percent and increased the business and occupation tax credit to $4,800. The initiative provided for additional funds to go to education and health services. Opponents of the initiative at Defeat1098.com [advocacy website] were concerned that the income tax would eventually extend to all Washington citizens, not just those in the upper income bracket. Proponents at Yeson1098.com [advocacy website], however, believed the tax would aid small businesses while funneling money toward health and education.
Washington is one of seven states in the US that does not have a personal income tax [DOR backgrounder], instead raising revenue through sales taxes and business taxes. Voters have rejected any attempts to create personal income tax, through several ballot initiatives. Although a graduated income tax was accepted in 1932, the state supreme court found it unconstitutional in 1933. The court held that income was property and that Article VII, Section 1 of the state constitution [text] precludes the non-uniform taxation of property. Ballot initiatives are not uncommon in Washington, with nine other issues on the ballot this November. Last year, voters expanded domestic partnership rights, and the year before, physician–assisted suicides [JURIST reports].