The Stand

Senate is choosing millionaires over students

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By DAVID GROVES
The Stand


OLYMPIA (May 31, 2013) — The government faces an imminent deadline to approve legislation that isn’t particularly controversial, but one political party has seized that deadline as leverage to try to force a controversial change in public policy that otherwise wouldn’t stand a chance of passage. It’s a political Game of Chicken that could have dire consequences for a basic function of government that all taxpayers rely upon.

You’d be forgiven if this sounds like more of the Congressional hijinks that has made that body less popular than cockroaches. But as it turns out, it’s happening — again — right here in Washington State.

5_30_Share of Households_updatedLast year, because of what all agree was a technical glitch in the law, a State Supreme Court ruling known as the Bracken decision said the state was improperly collecting the state’s voter-approved estate tax from married households. The Legislature has just days left, hours really, to correct this loophole that could cost some $160 million in revenue dedicated to education over the next two years. At a time when another Supreme Court ruling is forcing legislators to significantly increase school funding, you’d think this legislative fix would have been accomplished by now in a bipartisan fashion.

You’d be wrong.

Although both the Democrat-controlled House and the Republican-controlled Senate have bills before them that would correct the problem and apply the tax properly, the Senate is also trying to use the deadline — when refund checks will be sent to a few hundred of Washington’s wealthiest households — to force a tax cut for the richest 1% of Washingtonians.

As the Washington State Budget and Policy Center reports, the House is advancing HB 2064, which would clarify existing law and close the loophole for wealthy couples in a way that will protect future funding of public schools. The Senate version, however, would also make estates worth up to $5 million exempt from the tax, a significant increase over the current $2 million threshold for paying the tax. SB 5939 would slash estate tax rates across the board by 25% by 2022.

 

5_30 Decline in rates

 

Only the wealthiest families in the state would see any type of benefit under the Senate’s approach. Annually, a little over 300 households face Washington state’s estate tax. In 2010, out of the nearly 50,000 Washingtonians who passed away in 2010, only .6 percent owed any estate tax at all.

The Budget and Policy Center sums the situation up succinctly:

Washington state is under court order  to invest significant resources in fully funding education over the next few years. Proposing tax cuts for our state’s wealthiest households to the detriment of students moves us further away from meeting that obligation.

In yesterday’s editorial, “Cheapening the Estate Tax,” The (Everett) Herald echoes that sentiment:

Mending the glitch is not punitive, and it’s not new revenue. The Senate majority quickly seized on a time-sensitive dilemma to monkey an easing of the estate tax. It’s a backdoor way to make life easier for approximately 300 wealthy Washington residents. Washington needs to bolster K-12, higher-ed and a crumbling transportation system. A tax windfall for the well-to-do shouldn’t be on the agenda.

Are we still pretending that the Republican-controlled Senate, itself created by the most cynical and self-serving of political machinations, is the kind of bipartisanship that “people are crying out for?”

Short URL: http://www.thestand.org/?p=24240

Posted by on May 31 2013. Filed under STATE GOVERNMENT. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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