Trucking company owner suing state over 'millionaires tax' says policy hits small businesses

He did post "thr facxtual truth." Texas gets more money from the feds than it pays in taxes.

That's a pretty stupid ruling; any commonsense definitions of property and income delineate a fundamental distinction between the two.

The overall uniform taxation policy prohibits progressive taxation, and in turn fosters regressive taxation. Arguments can be made that both are unfair, but from a practical standpoint, you can't have equal tax burdens on Jeff Bezos and that guy who works the morning shift at Starbucks. Those who are more prosperous have to pay more. Otherwise, the system collapses.

Furthermore, those who are well off have to pay a higher rate as well as an overall higher amount. Flat taxation, where everyone pays the same (like a national sales tax), is in practice strongly regressive; you have to strip naked the less well-off to be "fair."

People call Washington 'liberal," but in this and many other issues, I see more "libertarian" than "liberal." This is a flawed political philosophy based on GUMMINT AM BAD. And what makes me laugh is that the Pacific Northwest and Northern Rockies states have cobbled together that philosophy based on that "rugged individualist" crap and the historical reality that DC is very, very far away. Like those fur trappers who answered to no one blah blah and their economic fortunes depended on fashion trends in London and Paris.

BUT...before the Depression-era BIG GUMMINT SPENDIN', Washington was America's western Appalachia. It's prosperous now because of all that free hydropower and the shift towards Asia after WWII. So the place would be West Virginia without that horrible BIG GUMMINT--pretty, and poor.

I can't really get kerfuffled about the state saying, OK, anything you make over $1 million, we get a dime on the dollar. I'm not weeping over that guy in the mansion on the hill not being able to afford that yacht he was coveting.

This proposed tax is to cover an anticipated revenue shortfall. If you don't like it, what other solution would you propose?

It's not a proposed law it is a new law. It was signed by the governor. It will start in 2028. (For taxes filed in 2029)

Whether I like it or not is not really the point. The point is it is unconstitutional. If the state wants to impose an income tax it must do so by amending the Constitution not ignoring it. 

The voters of Washington have stated clearly that they do not want an income tax. 

Income tax, as an example the federal income tax is actually very regressive. People pretend it's a progressive tax but it's not. The wealthy are able to avoid the taxes.

I don't really want any income to be taxed. I prefer to tax consumption rather than production.  

As far as what I would do instead I don't know. Personally I think Washington's budget suffers more from a spending problem than a revenue problem. I would try to start there. 

What would I do if tasked to figure out new revenue?

I would try to encourage and help start new businesses. Especially small to medium size business increasing the tax base. 

I would tax all business profit equally instead of giving huge breaks to some companies at the expense of others.

I would raise non-resident fees for State Parks, Ferries, and some other servises.

I would eliminate the non-resident sales tax exemption. (This allows residents of some states to get a refund for some of the sales tax paid in Washington) 

I would look to see where I could increase service fees. In general, and when possible a government function should be mostly funded by the people or businesses using that function. For example, the liquor control board should be mostly funded by the businesses that sell liquor. Restaurant inspectors should mostly be paid for by the restaurants that they inspect and/or their customers. The ferry system should be largely paid for by the people who ride the ferry etc. 

Edit: 

The State Constitution definition of property in the taxation section:  "The word "property" as used herein shall mean and include everything, whether tangible or intangible, subject to ownership" 

That still seems vague. Do you "own" your income? I would think that if you do, then it could be taxed. But the provision seems to exclude the possibility of progressive OR regressive taxation.

The trouble with taxing consumption rather than production is that the former is STRONGLY regressive. The poor and middle class consume a much greater proportion of their incomes than the rich. Thus, such taxation is a greater burden, the poorer you are. Aside from considerations of fairness or morality, it just doesn't work; not enough revenue is generated, unless you absolutely crush the lower classes.

That's why the idea of a national sales tax keeps falling on its ass.

I sense a contradiction when you say you don't want income to be taxed but then you say you want business profits to be taxed. Business profits do wind up as income to someone. What's the distinction? 

That sales taxes and other consumption tax systems can and often do disproportionately affect lower income individuals is a valid concern. One that I think could be addressed. 

There can be exemptions in place for things like primary transportation and necessary household appliances for a primary residence.

Exemptions for diapers, baby bottles, and some other child necessities. 

There could be a system where lower income individuals are entitled to a partial refund of sales tax paid or a standard deduction. 

We could have progression within the sales tax. For example if a widget is normally taxed at x percent you could set a rate of y dollars before the tax kicks in. 

Let's say a normal sales tax is 5%. You could set the taxable wristwatch amount at $100. The taxable used vehicke rate at $2500. The new vehicle rate at $50k. Etc. 

There already is one necessities exemption in all civilized states, by which I mean other than Idaho (a beautiful place run by amoral assholes), whereby grocery food is not subject to sales tax. I agree that this could and probably should extend to the "basics" of life. But again, something else would have to be more heavily taxed to make up for the shortfall.

It sounds like what you're recommending is essentially a luxury tax, or maybe a "not necessities" tax. Hoo boy, would that be complicated. Literally every consumer item would have to be separately evaluated. And then debated. And debated. And debated.

BTW, another crippling problem with a consumption-based tax system is that it discourages investment. Scrooge McDuck isn't taxed on all the money he rolls around in in his vault, but the moment he takes it out and buys something with it, he is taxed. So he's disincentivized to make that money work.

Maybe the best taxation system is the one recommended by PJ O'Rourke: "Eat the Rich."

It may discourage some spending but I think it would actually encourage investment. Investments in stocks and bonds and investments in business and in job creation. 

You wouldn't necessarily have to set rates for every consumer item. Just a few basic high ticket items such as vehicles, major appliances, and childcare supplies. Those items would have a minimum taxable price. 

Or simply issue sales tax refunds based on income level. 

There is no perfect system of taxation and I don't know what the answer is.

I do think, and have become increasingly convinced, we should, as much as possible avoid taxing individual income and avoid taxing job creation. (Like employment taxes). I think these taxes harm the economy and hurt the average individual more than many other forms of taxation.