Radio report: Rep. Orcutt says court ruling against capital gains income tax expected, but may be short-lived

March 1, 2022

A new capital gains income tax passed last year by legislative Democrats violates Washington's constitution, according to an Eastern Washington judge who ruled it invalid Tuesday. But the fight against the tax may not be over. John Sattgast explains from the state Capitol.

SATTGAST: Douglas County Superior Court Judge Brian Huber ruled the capital gains legislation “is properly characterized as an income tax…rather than an excise tax as argued by the state.”

House Republican Finance Leader Ed Orcutt says Republicans last year warned Democrats the tax is unnecessary, unpopular, and likely unconstitutional.

ORCUTT: “It's a victory for those of us fighting against an income tax. This is exactly what we told them we expected the court would rule when they were passing this bill and yet they passed it.”

SATTGAST: Orcutt believes, however, the victory may be short-lived.

ORCUTT: “I don't think this stops them. And that's the problem. I don't know that they're going to take 'no' for an answer.”

SATTGAST: In fact, Attorney General Bob Ferguson confirmed Tuesday he will appeal, which means the State Supreme Court may be the next venue. Orcutt says instead, the state should be providing tax relief from its 15-billion-dollar revenue surplus.

ORCUTT: “That's what we should be doing when it comes to taxes is providing that relief. Not finding some other way to take more money out of taxpayers' pockets.”

SATTGAST: John Sattgast, the state Capitol.