As the 2026 state legislative session approaches, rumors continue to swirl about a slew of new tax proposals which are likely to be considered. These proposals include a payroll tax and an income tax, among others.
While there are healthy debates over taxes every legislative session, these proposals warrant particular scrutiny as they come on the heels of the largest tax increase in Washington state history. The Legislature passed and the governor signed that last spring.
Taxes are necessary to fund expenditures related to public services. But when government spending creeps beyond core services and expands into discretionary programs, unnecessary tax increases cause harm to Washington state residents, small businesses and our economy.
Despite the largest tax increase in Washington’s history, we continue to hear from legislators that we are facing a budget shortfall. The question must be asked whether this shortfall is truly the result of insufficient tax revenue, or whether a reduction in spending should be part of the solution. In a poll published last year by the Seattle Metro Chamber, 76% of voters in Washington agreed that the state has more than enough money to address important priorities.
In just a single decade, state spending has nearly doubled from $43.6 billion in 2016 to $85.3 billion in 2025, according to the state’s Fiscal Information webpage. So, while Washington state residents and businesses are subject to record levels of taxes, legislators are approving budgets which spend twice as much as they did a decade ago.
I would submit that if the average Washington family or small business doubled their annual spending, they would expect to see far greater results from that spending than what we currently see from our state government. And if that family or small business faced a budget shortfall, as one might anticipate after having doubled their annual spending, I am confident they would look first to reduce spending to more appropriate levels before viewing the situation as a revenue problem.
Regardless of one’s perspective on spending levels and tax policy, what is evident is that these new taxes will harm, not help, our state’s economy. These impacts are being, and will continue to be, felt by residents and businesses alike. While proponents have attempted to argue that the tax increases will only impact big businesses and the wealthy, the same poll published by the Seattle Metro Chamber showed that 83% of voters believe companies will pass the cost of tax increases onto consumers.
According to the Tax Foundation’s 2026 Tax Competitiveness Index, Washington state is one of the worst states in the entire nation for tax competitiveness, having fallen to the rank of 45th overall. This number is not just a data point but is representative of an economic climate that is making Washington state an increasingly challenging place to live, work and play.
It is interesting to note that the same legislators who supported the largest tax increase in state history are now lamenting the affordability crisis in Washington, as if there was not a direct connection between the two. One way to increase affordability and competitiveness in our state would be for legislators to consider spending reductions and tax relief.
As a local government official, I was perplexed to hear a state legislator recently remark that it is our responsibility as local government leaders to “help legislators educate the public on why tax increases are needed.” Surely, just the opposite is true. It is elected officials who serve at the pleasure of the public, not the other way around.
If we want our state to have a strong economy and an affordable cost of living, legislative leaders must look to moderate public spending and provide tax relief to Washingtonians in the upcoming legislative session. We are blessed to call one of the most beautiful regions on earth home. Let’s make sure the next generation has the opportunity to live, work and play in a thriving Washington state.
