Washington State House Democrats


Seattle Representative Gerry Pollet proposes treating tax exemptions like budget line items

OLYMPIA – While education is constitutionally underfunded and children’s classrooms are overcrowded, the state offers hundreds of tax exemptions that account for hundreds of millions of dollars, with little to no review for most. New legislation introduced by Rep. Gerry Pollet (D—Seattle) and Sen. David Frockt (D—Seattle) would increase tax exemption transparency and accountability by requiring tax loopholes be listed in a special budget, requiring a biennial vote just like the operating budget.

The bill would acknowledge the actual cost of tax exemptions in the budget, require that the purpose and necessity of each exemption be listed in the “tax exemption budget,” and require a public hearing and vote to adopt it. In addition, the Joint Legislative Audit and Review Committee would be required to recommend an exemption be closed if analysis showed the cost to the public outweighed the benefits.

“It’s time we acknowledge that when we give a break to business, it costs our budget. Every tax loophole we pass must be reviewed regularly. Tax loopholes should not have a free pass to drain money from our budget without review. Accountability demands that we change this system” said Pollet.

“The state needs to end tax exemptions as off-budget spending and put tax exemptions into the state budget for accountability and transparency “said Steve Zemke, a long-time tax transparency advocate.

Unless an exemption has a specific sunset or review clause, passed after 2013, or is reviewed by JLARC, very few exemptions receive scrutiny by legislators. This law would require biennial review of all exemptions to improve accountability to the public.