Washington State's House of Representatives approved a 9.9 percent income tax on earnings above $1 million in a 51-46 vote, advancing the measure to the Senate as early as Wednesday.
The tax applies only to income exceeding the $1 million threshold. An individual earning $1.1 million would owe tax solely on the $100,000 above the limit.
The measure targets approximately 20,000 to 30,000 households—the state's wealthiest 0.5 percent. Collections begin in 2029, based on income earned in the prior year.
Projected revenue stands at $3.5 billion to $4 billion annually. The state plans to use proceeds to reduce its budget deficit and offset existing sales and business taxes. The bill also eliminates state sales tax on diapers, over-the-counter medications and personal hygiene products, and expands the Working Families Tax Credit to an additional 460,000 households, providing rebates up to $1,330 per year.
House debate stretched more than 24 hours, beginning at 5:38 p.m. Monday and ending around 6:10 p.m. Tuesday. Republicans introduced nearly 60 amendments; Democrats proposed nearly two dozen.
Republicans argue the tax violates the Washington State Constitution, which classifies income as property and mandates uniform taxation that cannot vary based on earnings. Eight Democrats joined Republicans in opposing the final vote.
Governor Bob Ferguson, a Democrat, said he supports the measure. The bill now faces a Senate vote and potential legal challenge on constitutional grounds.
