Washingtonians remain supportive of a capital gains tax on the wealthy, despite right wing efforts to overturn ESSB 5096

Vot­ers in Wash­ing­ton remain sup­port­ive of tax­ing the cap­i­tal gains of the state’s wealth­i­est fam­i­lies to fund crit­i­cal invest­ments in ear­ly learn­ing, child­care, and pub­lic edu­ca­tion, NPI’s most recent statewide sur­vey of like­ly vot­ers confirms.

56% of 1,039 Wash­ing­ton vot­ers inter­viewed from June 1st-2nd, 2022 expressed sup­port for levy­ing a cap­i­tal gains tax on the wealthy after hear­ing a selec­tion of argu­ments for and against it, while 37% expressed oppo­si­tion. 7% were not sure.

This is the eighth con­sec­u­tive year that a statewide NPI sur­vey has found a major­i­ty of Wash­ing­ton vot­ers in favor of a cap­i­tal gains tax, which indi­cates that there is a durable, depend­able reser­voir of sup­port in the Ever­green State for bal­anc­ing our tax code with pro­gres­sive laws based on abil­i­ty to pay.

Last year, acknowl­edg­ing the need to fix Wash­ing­ton’s upside down tax code and deep­en our invest­ments in essen­tial pub­lic ser­vices, the Leg­is­la­ture passed Engrossed Sub­sti­tute Sen­ate Bill (ESSB) 5096, which Gov­er­nor Jay Inslee sub­se­quent­ly signed into law fol­low­ing Sine Die.

ESSB 5096 trans­formed what had pre­vi­ous­ly been a long-dis­cussed pro­pos­al into the law of the land, over the objec­tions of Repub­li­can leg­is­la­tors bent on keep­ing Wash­ing­ton a tax haven for mil­lion­aires and bil­lion­aires who aren’t pay­ing their fair share in dues to sup­port and strength­en Wash­ing­ton’s communities.

With­in months of ESSB 5096’s adop­tion, a group of right wing plain­tiffs rep­re­sent­ed by for­mer Attor­ney Gen­er­al Rob McKen­na filed a legal chal­lenge against the new law, seek­ing its inval­i­da­tion on con­sti­tu­tion­al grounds.

The group select­ed Dou­glas Coun­ty as the venue for its law­suit, seek­ing a friend­ly tri­al court in a juris­dic­tion with a long his­to­ry of anti-tax sen­ti­ment, and suc­ceed­ed in obtain­ing a favor­able pre­lim­i­nary rul­ing from Judge Bri­an Huber, which has since been appealed to the Wash­ing­ton State Supreme Court.

While the case was pend­ing before Huber, a sep­a­rate effort helmed by for­mer Dino Rossi aide J. Van­der Stoep began solic­it­ing funds for a bal­lot mea­sure cam­paign to repeal ESSB 5096 via ini­tia­tive. How­ev­er, the effort stalled out and ceased oper­a­tions with­out gath­er­ing a sin­gle signature.

That has left McKen­na’s legal chal­lenge as the only vehi­cle for over­turn­ing ESSB 5096 — at least for the time being. Right wing groups ardent­ly opposed to rev­enue fair­ness in Wash­ing­ton have made the law­suit a P.R. pri­or­i­ty, gen­er­at­ing a steady stream of blog posts and tweets attack­ing ESSB 5096 from every angle in an attempt to sway pub­lic opin­ion against the law.

But as our lat­est poll find­ing demon­strates, they sim­ply aren’t get­ting traction.

Here’s the text of the detailed cap­i­tal gains tax ques­tion that we have been ask­ing since ESSB 5096 passed fol­low­ing the adjourn­ment of last year’s ses­sion. As you can see, it presents both the case for the cap­i­tal gains tax as well as the case against it, using the oppo­si­tion’s own lan­guage word-for-word.

QUESTION: Pro­po­nents say that Wash­ing­ton State’s new state cap­i­tal gains tax on the wealthy will raise about $500 mil­lion a year in cru­cial fund­ing for edu­ca­tion in Wash­ing­ton State, includ­ing ear­ly learn­ing and child­care, and will help bal­ance our upside-down tax code by requir­ing the wealth­i­est 8,000 indi­vid­u­als to step up and pay their fair share in dues to our state. Oppo­nents say that the new state cap­i­tal gains tax on the wealthy is an uncon­sti­tu­tion­al and ille­gal income tax that will hurt job cre­ation and put the state at a com­pet­i­tive dis­ad­van­tage, hurt­ing the whole econ­o­my while fail­ing to address regres­siv­i­ty. Both sides agree that the text of the cap­i­tal gains tax law ful­ly exempts retire­ment accounts, fam­i­ly farms, and all real estate. Hav­ing heard the argu­ments for and against, do you strong­ly sup­port, some­what sup­port, some­what oppose, or strong­ly oppose Washington’s new state cap­i­tal gains tax on the wealthy?

ANSWERS:

• Sup­port: 56% 
  • Strong­ly: 41%
  • Some­what: 15%
• Oppose: 37%
  • Some­what: 8%
  • Strong­ly: 29%
• Not sure: 7%

When we asked this exact same ques­tion in May of 2021, in a sur­vey of 992 like­ly vot­ers, sup­port stood at 57% over­all, with 40% oppo­si­tion and 3% not sure.

In the span of a year, total sup­port has remained vir­tu­al­ly unchanged, with a slight boost in inten­si­ty (41% strong­ly sup­port­ive this year ver­sus 39% strong­ly sup­port­ive last year) and a three point decrease in total oppo­si­tion. And that’s dur­ing a peri­od of time dur­ing which right wing groups like the Wash­ing­ton Pol­i­cy Cen­ter have been try­ing furi­ous­ly to ral­ly peo­ple against ESSB 5096.

It’s tru­ly reas­sur­ing to see that pub­lic sup­port for this cru­cial­ly impor­tant pro­gres­sive tax reform has remained intact despite the effort to turn Wash­ing­to­ni­ans against it. The recent spec­tac­u­lar demise of I‑1929 was a tac­it con­ces­sion from right wing forces that pub­lic opin­ion isn’t on their side.

If they were con­fi­dent of win­ning a statewide vote, they would have moved for­ward, even at an inflat­ed cost of tens of mil­lions (which their donors could have afford­ed). But they chose not to because of the high risk of failure.

If ESSB 5096 can pass con­sti­tu­tion­al muster in the courts, it stands an excel­lent chance of remain­ing the law of the land in Wash­ing­ton, because — as our polling once again shows — it’s a win­ner in the court of pub­lic opinion.