Activists flood city council chambers during a meeting of the Affordable Housing, Neighborhoods and Finance Committee where councilmembers discussed a proposal for a local income tax and soda tax on Wednesday, May 31.
Activists flood city council chambers during a meeting of the Affordable Housing, Neighborhoods and Finance Committee where councilmembers discussed a proposal for a local income tax and soda tax on Wednesday, May 31.
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Residents in support of a local income tax on Seattle’s highest earners crowded city council chambers Wednesday morning for a meeting of the Affordable Housing, Neighborhoods and Finance Committee.

The Trump-Proof Seattle Campaign, a coalition of more than 45 community groups, labor unions, political organizations and associations, is pushing for the city to a pass a 1.5 percent tax on income in excess of $250,000. The group lined the walls, unrolling posters filled with petition cards from districts around Seattle urging councilmembers to pass the new tax.

Trump-Proof Seattle says much of the tax burden falls on households making the least in Seattle, and believes the wealthiest households should pay higher taxes to bring in much-needed revenue for public services such as homelessness, affordable housing, education and public safety infrastructure.

“It’s needed, it’s just and it’s long overdue,” said Gabriella Möller during public comment. “It is outrageous that as one of the most progressive cities in the country, Seattle has the most regressive tax system in the country. Our heavy reliance on sales and excise taxes is pushing our most impoverished taxpayers deeper into poverty.”

Councilmember Lisa Herbold sponsored a resolution in May, which was later unanimously approved by the city council, expressing the city’s intent to adopt a progressive income tax that would target high-income households. With seven out of nine councilmembers in attendance Wednesday, they began the discussion of the new tax during the special meeting of the committee.

“As an elected official, frankly I’m tired of telling people that the only source to address basic city needs that we have available to us is the property tax,” Herbold said.

She added Washington doesn’t just have the most regressive taxation system, it is the worst in the country as it relates to fairness, transparency, adequacy, stability and economic vitality.

Dick Conway, an economist and co-publisher of The Puget Sound Economic Forecaster, echoed Herbold’s opening remarks during a presentation to councilmembers. Quoting a report by the Institute on Taxation and Economic Policy, he said, “lacking an income tax, Washington has the most unfair tax system in the nation.”

The institute’s 2015 report found the poorest residents in the state paid 16.8 percent of their income on state and local taxes, while the highest earning families paid 2 percent.

“This meant that the lowest-income families had to work 8.7 weeks out of the year to satisfy the state and local tax obligations, while the highest-income families had to work only 1.2 weeks,” Conway said.

Herbold said that no specifics had been decided, but the proposal by the Trump-Proof Seattle Campaign of a 1.5 percent tax on income earned above a quarter-million dollars was “around where we are heading as well.”

John Burbank, executive director of the Economic Opportunity Institute, also a member of the Trump-Proof coalition, estimated the proposed tax would impact about 2.2 percent of households in the city and generate about $200 million a year.

“It’s up to you as councilmembers to decide how we are going to meet our urgent public services [needs] while not pushing more regressive taxes onto middle-class families,” Burbank said during his presentation to the council.

According to the Transit Riders Union, which is spearheading the campaign, Herbold — along with councilmembers Kshama Sawant, Mike O’Brien, Rob Johnson and Bruce Harrell — are in support of a local income tax. Councilmembers anticipate releasing a plan as early as next week, with a goal of passing legislation for a city income tax by July 10.

Currently, a progressive tax is considered unconstitutional in Washington. The state’s constitution defines income as property that must be taxed uniformly.

Conway told councilmembers a flat tax would be allowed under the constitution. He said if Washington adopted just a 10.5 percent flat-rate personal income tax, the state would have the best state and local tax system in the nation and eliminate the need for all other taxes.

“A single-rate personal income tax would be perfectly fair,” Conway said. “Every household, no matter what its income, would have to work 5.5 weeks to pay its tax bill.”

Sawant said while a flat tax would be better than the current system, “I think we should aim for a progressive tax and eventually go towards eliminating the taxes on the poorest people and middle-class people.”

“Because the system is stacked so much against them, why should they have to pay anything?” Sawant said. “They are already paying so much.”