WA Supreme Court upholds capital gains tax
The Washington state Supreme Court has upheld the constitutionality of the state’s capital gains tax, cementing a long-sought victory for state Democrats and nudging the state’s tax system in a more progressive direction. The court ruled 7-2 Friday morning to uphold the tax. The court declined to revisit its nearly century-old precedent, which bars a progressive income tax, but instead ruled the tax is constitutional because it is an excise tax, not a property tax. Democrats passed the measure in 2021, with plans to spend the revenue on early childhood education programs. It applies a 7% tax on the sale of financial assets such as stocks and bonds. The tax only applies to profits over $250,000. It is expected to initially bring in about $500 million a year in revenue. Rep. April Berg, D-Mill Creek, chair of the House Finance Committee, said the ruling “provides the clarity needed to move forward with this significant reform to our tax structure. It’s time for the wealthiest among us to share in the responsibility of funding the needs of our communities.” Continue reading at Seattle Times. (Ellen M. Banner)

WA Senators propose two-year, $69.2 billion operating budget — and saving for a rainy day
Washington State Senate budget writers released their proposal Thursday for a two-year, $69.2 billion operating budget. While $5.1 billion is added in new spending for the 2023-25 biennium, no new taxes or fees are added to provide the new funding. Even with new spending, Senators have proposed leaving $3.8 billion for reserves as a safeguard for an economic slowdown as well as protection for Washington’s currently high credit rating. Major budget investments are targeted to public schools, housing and homelessness, as well as behavioral health services and investments to fight climate change. House budget writers are expected to release their budgets next week, and Senate and House lawmakers will work together to negotiate on a final spending plan by the end of the session on April 23. Continue reading at Olympian.

Affordable-housing measures see mixed success in Olympia
In the thick of the Legislature’s 105-day session, various bills aiming to provide more affordable housing for Washington residents are gaining traction, while others have fizzled out on the floor. A 2022 poll of 600 Washington residents conducted by the Sightline Institute and Lake Research Partners found that 61 percent of them support legislation that aims to fill the gap in the middle. House Bill 1110, sponsored by Rep. Jessica Bateman, D-Olympia, has a more comprehensive approach than its predecessors. Aside from more affordable housing, it aims to address discrimination against marginalized renters. “Washington is experiencing a housing shortage, which is culminating in a housing crisis. This supply imbalance is creating increasingly expensive homes, and increasingly expensive rents that’s impacting our constituents in every corner of the state,” Bateman said during a public hearing. Continue reading at The Columbian. (iStock)