Without counting one-time funds, Washington state now has a four-year budget surplus of $11.2 billion, according to a new policy brief from the Washington Research Council.
rescue plan transition account, $1.3 billion in general federal relief funds, and about $1.2 billion in the budget stabilization account.
The rosy budget picture comes from $7.4 billion in increased forecast state tax revenues since the 2021 legislative session ended, along with $350 million from collections coming in above the most recent revenue forecast, and $2.4 billion in savings from lower-than-expected costs of providing ongoing services.
The policy brief notes that Gov. Inslee calls for increased spending and higher reserve levels but no tax cuts.
“The Legislature could reasonably choose to use some of the surplus on tax reductions as well,” the Washington Research Council concludes. “After all, as far as budget sustainability is concerned, spending increases and tax cuts are two sides of the same coin.”
Legislators have proposed a variety of tax reduction measures, including bipartisan bills to provide B&O tax relief for manufacturers (Senate Bill 5769 would eliminate the B&O for manufacturers and Senate Bill 5957 would reduce it). Other bills include Senate Bill 5932, which would reduce the state’s sales tax by 1% and House Bill 1819, which would increase the personal property tax exemption from $15,000 to $100,000.
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Credit: Association of Washington Business
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