Washington state lawmakers voted Wednesday to approve a new tax targeting high-income earners after an extended and contentious debate that stretched more than 24 hours on the legislative floor.
The measure imposes a 9.9 percent annual tax on personal earnings above $1 million, a proposal supporters say will help generate billions in new revenue for the state. Lawmakers estimate the tax could bring in as much as $4 billion annually once implemented.
Under the legislation, the revenue would be directed toward expanding childcare programs and eliminating sales taxes on hygiene products. Democratic Gov. Bob Ferguson signaled his support for the plan and said he intends to sign the bill into law.
Ferguson suggested the policy could help make Washington “more affordable,” according to supporters who argue the state’s tax system has long placed a disproportionate burden on lower-income residents.
If signed, the measure would not take effect immediately. The law is scheduled to begin on Jan. 1, 2028, with the first tax payments due the following year in 2029. Lawmakers estimate roughly 21,000 residents across Washington would be affected by the new tax.
Democratic leaders framed the vote as the culmination of decades of debate over the state’s tax structure. Washington is known for operating without a traditional income tax, a model that has existed for generations but has also drawn criticism from those who believe the system is outdated.
State House Majority Leader Joe Fitzgibbon, a Democrat, said the legislation addresses what he described as a long-standing imbalance in how the state collects revenue.
“It has been a long journey here to this moment, not just the over 24 hours that we’ve spent on this floor debating this proposal, but the 93 years that Washingtonians have struggled with a grossly outdated tax structure that falls by far the heaviest on the lowest income,” Fitzgibbon said, according to the Washington State Standard.
Not everyone is convinced the change will deliver the benefits supporters promise. Critics argue that altering Washington’s decades-old income tax–free model could drive wealthy residents out of the state and damage the broader economy.
Some prominent figures have already indicated they are reconsidering their ties to the state. Former Starbucks CEO Howard Schultz said Wednesday he would be leaving Washington for Florida as lawmakers debated the proposal, which opponents have dubbed the “millionaires’ tax.”
Republican lawmakers strongly opposed the measure during the lengthy debate, arguing that the legislation should be put directly before voters rather than enacted solely by the legislature.
Rep. Peter Abbarno, a Republican, said Washington residents deserve a say before such a major shift in tax policy is implemented.
“The people of Washington have a right to know what’s in this bill. The people of Washington have a right to know what’s not in this bill and they have a right to decide,” Abbarno said, according to the Washington State Standard.
Voters in the state have repeatedly rejected similar proposals in the past. Income tax measures have been turned down ten times by Washington voters, including the most recent rejection in 2010.
Even as the bill moves toward the governor’s desk, lawmakers expect the issue may not be settled anytime soon. Legal challenges to the legislation are widely anticipated, setting the stage for a potentially lengthy court battle over the future of the state’s tax system.
For now, the vote marks a significant shift in a state long known for avoiding an income tax altogether — a move supporters say modernizes the system but one critics warn could reshape Washington’s economic landscape.
