Covid relief tops state budget priority list
January 14, 2021
Desperately needed covid-19 relief is a top priority for this year's Legislature, and Republicans and Democrats generally agree it will be necessary to get that aid out as soon as possible.
The parties are split, however, when it comes to increasing some taxes to erase a pandemic-caused revenue shortfall.
House Speaker Laurie Jinkins, D-Tacoma, outlined on Jan. 7 some of the early action economic relief Democrats have lined up. This included, among other things: at least $300 million for rental and utility assistance, $120 million for business assistance grants and $25 million for food assistance. She said they want to reduce state taxes on pandemic emergency Paycheck Protection Program federal funds, currently subject to the state Business & Occupation tax, and waive property fees and lower property tax rates for businesses.
She also said they would propose tapping the state’s rainy-day funds to help pay for the proposals. “We’re in rainy days,” she said.
Gov. Jay Inslee said he proposes lowering unemployment insurance taxes for small businesses and financing the working families tax credit with a new capital gains tax. He said the governor's office projects that fewer than 2% of the state’s population would be affected by the increase. He said he favors that option over increasing existing taxes which already lean too heavily on working families.
“Our tax system, frankly, is a scandalous situation, because it rewards the wealthiest and puts the demands to finance the needs of Washingtonians on those who can meet that need the least,” Inslee said.
Sen. Manka Dhingra, D-Redmond, agreed with Inslee.
“We have so much work to do ahead of us when we're talking about rental assistance and we're talking about small business loans. We're talking about the homelessness issue, the eviction moratorium being lifted. We haven't even started talking about a foster care situation that was already struggling,” Dhingra said. “And we have police accountability issues to deal with. All of those cost money. We can write pretty words on a piece of paper and pass them, but if you really want to help people, you have to put the dollars behind those words.”
Sen. Shelly Short, R-Addy, said she is sympathetic to the many obvious needs facing Washington, but said the Legislature needs to carefully weigh adding new taxes.
“We are learning a lot about the needs and the things that we have before us,” Short said, “but the last thing we should be doing is raising taxes on our family-owned businesses and our job creators in the state of Washington. The fastest way we can get people back on their feet is to get them their jobs back,” Short said.
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