Orcutt releases statement on Democrats’ passage of largest tax increase in state history

Nearing the end of the 30-day special session called by Gov. Gregoire, Democrats in the House tonight approved nearly $1.7 billion in new and increased taxes for the 2011-13 biennium, over $794 million in the first year alone.

Rep. Ed Orcutt, R-Kalama and ranking Republican on the House Finance Committee, released the following statement:

“This is an $800 million-a-year financial hit that our families, our employers and our economy cannot afford. If Democrat budget writers had put half as much effort into balancing the budget through true government reforms and efficiencies as they put into arguing with each other over which taxes to raise, we'd have a balanced budget, no tax increases and no special session.

“Instead of spending 30 days sharpening our pencils, applying the priorities of government process and implementing meaningful government reforms, budget writers from the majority party haggled over who would be the 'winners and losers' while resorting to tax increases.

“This is a sad day for struggling families and employers. This tax increase represents the largest tax increase in state history and it will have a negative impact on our chances for economic recovery.

“Washington's employers are hit especially hard with B&O tax increases and our convenience stores are brutalized with new and increased taxes on bottled water, beer, cigarettes, soda, candy and gum making our tax system even more regressive.  Border counties, like those in my district in Southwest Washington, are going to lose precious jobs because of these tax increases.”

New and increased taxes approved by House Democrats amount to nearly $1.7 billion for the 2011-13 budget cycle ($794 million in just the first year alone) – the largest tax increase in state history. They include:

  • A 0.30% increase in the B&O tax on all services except hospitals and scientific R&D = $242 million;
  • DOT foods = $155 million;
  • Cigarette($1 per pack) and other tobacco products = $101 million;
  • B&O tax on economic income (Nexus) = $84.7 million;
  • 50-cent per gallon (28-cents per six pack) beer tax = $59 million;
  • Sales tax on bottled water = $32.6 million;
  • Sales tax on candy/gum = $30.5 million;
  • 2-cent per 12-ounce soda tax = $33.5 million;
  • Taxes on business structure transactions = $8.5 million;
  • B&O tax increase on property management salaries = $6.9 million;
  • B&O increase on certain canned meat products = $4.1 million;
  • B&O tax increase on mortgages = $3.6 million;
  • B&O tax increase on corporate officer salaries = $2.1 million;
  • Tax increase on bad debts = $1.7 million;
  • Tax increase on livestock nutrient management = $1.3 million;
  • Tax increase on PUD electric bills = $1.2 million;
  • Personal liability for tax debts = $1.1 million.

 

The 2010 regular legislative session ended March 11. Gov. Gregoire called the Legislature into a special legislative session so majority Democrats could finalize their operating budget and tax increase proposals. The 30-day special legislative session is scheduled to end on Tuesday, April 13.

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For more information, contact: Brendon Wold, Senior Information Officer, (360) 786-7698.

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Washington State House Republican Communications
houserepublicans.wa.gov