To put it simply, voters should reject Initiative 1366.
Initiative promoter Tim Eyman, in his quest to require that the Legislature submit to a two-thirds majority in both houses for tax increases, is back with I-1366.
Earlier initiatives were either overturned by the state Supreme Court or suspended by the Legislature. This time the initiative seeks to make the requirement part of the state constitution. But because state law says the constitution can’t be changed by initiative, Eyman and his backers are using this initiative to force the Legislature’s hand to draft an amendment and bring it before voters for their approval.
I-1366 seeks to spur lawmakers to offer the amendment through the use of what some have called blackmail. Eyman considers it leverage, similar to the threat to take away his son’s Xbox unless he takes out the garbage.
But this is more than a night without video games. Unless the Legislature drafts an amendment to put before the voters, the state’s sales tax rate would be reduced by 1 percentage point, to 5.5 percent from 6.5 percent as of April 15, 2016. The hit of such a reduction to state revenue would be staggering, between $1.4 billion and $1.7 billion each year, $8 billion over a six-year period.
That would be huge hole to fill for a Legislature that has struggled to meet a Supreme Court mandate that it amply fund basic education for K-12 students.
I-1366 offers a choice between two paths: Amend the constitution or face a budgetary crisis.
Passing a constitutional amendment to require a two-thirds majority in both houses for tax increases would likely permanently lock the state into its current system of taxes. And it’s a system that many, including the nonprofit and nonpartisan Institute of Taxation and Economic Policy, say is the most regressive and unfair tax system in the nation. Because of Washington state’s reliance on sales tax, those making less than $21,000 a year pay nearly 17 percent of their income as taxes, while those in the top 1 percent, making more than $507,000 a year, pay only 2.4 percent of their income as taxes.
Even an attempt to pass revenue-neutral reforms would be subject to the two-thirds requirement, because even as some taxes would be reduced, others would need to be increased. A two-thirds majority would be, as is intended, extremely difficult to a achieve. As few as 17 senators or 33 representatives could scuttle any tax reform proposal.
Supporters of Eyman’s initiative, however, may be making a dangerous assumption that the Legislature will take the path for a constitutional amendment. Proposing a amendment to the voters would, itself, require a two-thirds majority in both houses. How far-fetched is it to imagine that either 33 representative or 17 senators would call Eyman’s bluff and allow the sales tax rate to be reduced, resulting in a budgetary crisis that could finally force tax reform?
The most likely scenario should voters approve I-1366 is that it, like many of its brethren, will be rejected by the Supreme Court. Eyman seems unconcerned about that possibility, believing in the “lobbying effect” of his initiatives. For example, even though Eyman’s I-695, which sought to eliminate the state’s Motor Vehicle Excise Tax and impose the two-thirds requirement, was found unconstitutional, the initiative’s approval by voters successfully lobbied the Legislature to set the limit for car tabs at $30.
But the two paths that I-1366 offers muddies the message of Eyman’s “lobbying effect.” Do those who vote for I-1366 want the constitutional amendment or the reduction in sales tax?
And why is a two-thirds majority worthy of inscribing in the state constitution?
This year, even with the state Supreme Court’s finding of contempt hanging over it on education funding, the state Legislature rejected several tax increase proposals. The one tax increase it did approve, an increase in the gas tax, was passed at the urging of many Republicans who rightly saw the need for a significant state investment in transportation, one necessary for the state economy. By the way, the House voted, 54-44, for the gas tax increase, which would have fallen short of a two-thirds majority.
With exceptions, notably amendments to the state constitution, rule by a simple majority has allowed necessary legislation to move forward while protecting the interests of the people of Washington. There’s no need to change that.
I-1366 offers only uncertainty for the funding of K-12 schools, higher education, health care, public safety and more.
And for its supporters it may be hiding the unintended consequence of the opposite of what they seek.
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