WASHINGTON – A complicated tax bill rejected by the U.S. Senate late Thursday could have ended up hurting tens of thousands of low-wage workers in Washington state who need a raise, Sen. Maria Cantwell said.
Cantwell, D-Wash., said the tax package – which would have combined a minimum-wage increase and an estate-tax cut – could have resulted in a $5-an-hour pay cut for more than 120,000 waiters, waitresses and other tip earners in the state.
“Washington voters passed a minimum-wage increase adjusted for inflation in 1998 by a wide margin. It is senseless to roll it back now,” she said.
Cantwell and fellow Democratic Sen. Patty Murray voted against the wide-ranging bill, which also would have renewed a sales-tax deduction for residents of Washington and other states without an income tax and would have provided a long-sought tax break for the timber industry.
Given her past support for three of the bill’s major provisions – the minimum-wage increase, sales tax deduction and timber industry credit – Cantwell said she was tempted to vote for the bill.
But she said a provision that could override state law and force a pay cut for employees who receive tips made it impossible for her to vote yes.
“Our minimum wage (in Washington state) is indexed to inflation. I’m not going to do anything that undermines that,” Cantwell said in an interview Thursday.
She said she especially regretted voting against the sales-tax deduction, which she and other Washington state lawmakers have fought to preserve. But “I’m not going to cut the minimum wage for over 100,000 people in my state just to get it. You don’t rob Peter to pay Paul,” Cantwell said.
She said there is plenty of time to extend the sales-tax deduction, which expired at the end of 2005.
Cantwell, who faces a tough re-election fight with Republican Mike McGavick, was the focus of intense GOP lobbying on the tax bill, in part because she and Murray were among those who voted against the estate-tax cut when the measure fell three votes short in the Senate earlier this year.
The sales tax and timber provisions were widely seen as lures for the Washington state Democrats, but in the end, Cantwell and Murray said, they were not enough.
In statements Thursday, they used the same language, calling the bill a “cynical Republican ploy” aimed more at the November elections than at helping low-wage workers.
“While there are provisions that I do support in this bill, I cannot vote for a Republican plan that plunges our nation further into debt while reducing the wages of our nation’s workers,” Murray said. “This bill would hurt all Americans.”
McGavick immediately denounced Cantwell’s announcement, charging that she was siding “with her party’s leaders over the interest of our state.”
In opposing the bill, Cantwell “is voting against a permanent solution to the federal estate tax, against extension of state sales-tax deductibility, against tax relief for our timber companies and against extension of the research-and-development tax credit,” McGavick said.
Cantwell also is voting against an increase in the federal minimum wage, McGavick added, calling her position “profoundly disappointing.”
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