pudge's Journal: Washington State Income Tax Bill

It's a little hard to find -- since it's not yet on the bill's page -- but the proposed substitute for the income tax bill is available under that page's Committee Materials link.

It's not an amendment, but a completely different bill. You'll want to look at Section 401 ("For income earned on or after January 1, 2011, a tax is imposed at the rate of four and five-tenths percent on all taxable income of resident individuals and on all individuals deriving income from sources in Washington for each taxable year.") and Section 504 ("There is allowed from taxable income the following standard deductions. ...").

However, there is no severability clause: so if that's the case and Section 504 is found to be unconstitutional, the whole thing would get thrown out. That is made explicit in Section 1202. That's the only good news here. Perhaps they changed the severability clause from last year's version because of exactly this criticism: that it would end up as a tax on everyone if the standard deductions were found unconstitutional, which is likely, if the Court follows longstanding precedent.

As a refresher, our State Constitution, in Article VII, Section 1, says, "All taxes shall be uniform upon the same class of property within the territorial limits of the authority levying the tax. ..." And our Court has consistently ruled that money is property (having found this because, I presume, it is obviously true). So without overturning many decades of precedent and finding that money is not property, the only way to make this fly would be to rule that different levels of income are property, which would be even more twisted than finding that money isn't property.

Or they could just completely take leave of their senses and find that a standard deduction that is, by the words of the people who authored it, explicitly designed to target specific taxpayers (thus violating the spirit and letter of the Constitution), is nevertheless "uniform" because "the tax is on everyone, but it just exempts certain amounts for everyone."

Cross-posted on <pudge/*>.