Rep. Matt Manweller: Answer is spending reform, not “tax loopholes”

Rep. Matt Manweller: Answer is spending reform, not “tax loopholes”

There have been a lot of conversations in Olympia the past few months about adding new taxes. But taxpayers are already going to pay $3 billion in additional taxes in this two-year budget cycle, which is an 8.6 percent increase.

House Republicans believe with this new revenue, and by prioritizing our spending, we should have enough to add more money to K-12 education, per the McCleary decision, and add funding for our mental health system and for our most vulnerable.

Unfortunately, what you often find in government is that no matter how much money there is, for some people there is literally never enough and tax increases, or new taxes, are the first and only recourse when faced with a challenging budget situation.

Sure enough, even the additional $3 billion hasn’t stopped House Democrats from claiming that the state doesn’t have enough tax revenues. They argue that the taxes we are taking in aren’t enough to fund all the programs of Washington state.

The House majority party’s budget proposal would increase taxes by $1.5 billion. They want to increase the B&O tax by 20 percent, and it would increase taxes on most everyone who works in the service professions. I am guessing most people in Washington don’t feel undertaxed and we should not be trying to regain our status as the 11th most taxed state in the nation.

Now, to be fair, the people arguing in favor of new and increased taxes are also saying that Washington’s whole tax system is unfair, and I agree we do have a regressive tax system. Both parties in the Legislature would like to see some serious reforms.

But one of the tax increases masquerading as a “reform” by the House majority is to eliminate “tax loopholes.” They argue eliminating unfair tax breaks would help fund education and other programs.

However, let’s remember that the party in power in the state House and the governor’s office have run the show in Olympia for most of the last three decades. They have fought hard to preserve our tax system the last 30 years. And for all their current rhetoric against what they call tax loopholes, over the past decade, Democrats have prime-sponsored 86 percent of the tax exemptions, and Republicans only 14 percent – that’s 120 out of the 140 tax exemption bills since 2005. If tax exemptions are a problem, then it is a problem the Democrats created. This type of hypocrisy is what drives voters crazy.

Closing tax incentives may generate more revenue in the short-term, but long-term it doesn’t address the problem. Without some important tax breaks, businesses will leave for better economic environments in other states. We will have driven away the businesses that create jobs and generate tax revenue for our schools.

We are not a business-friendly state. The so-called loopholes are in place so our state can stay competitive with other states and attract employers. Outside of the I-5 corridor the economy is still slow to recover. King and Snohomish counties have unemployment rates of 4.9 and 5.3 percent respectively, but there are 12 counties with unemployment rates of over 10 percent and most are at eight or higher.

Tax reform is not the ultimate solution, spending reform is. Revenue has not been the problem in Olympia. Our operating budget has grown from approximately $18.4 billion to a projected $39 billion in 20 years. Maybe the priorities have been out of line much of the last few decades.

Taxpayers should not have to foot the bill when lawmakers can’t make ends meet with an 8.6 percent increase in revenue.

House Democrats want accountability and transparency with tax exemptions, but shouldn’t that apply to the budget?

A quick review: our friends across the aisle are criticizing our tax system and the tax preferences we have in statute – a problem they have created. Yet, their solution is to get rid of tax incentives that keep many employers competitive and in Washington state. This is not a real solution.

How thick is the hypocrisy? About 30 years’ worth since they have been in control for most of that time and have yet to offer a meaningful solution.

Let’s stay on task and be responsible with our taxpayers’ money and we can start by using $3 billion efficiently, effectively and control spending…rather than use a regressive tax system as an excuse to tax and spend more.

Rep. Matt Manweller, R-Ellensburg, serves on the House Finance Committee.

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Washington State House Republican Communications
461 John L. O’Brien Building
P.O. Box 40600
Olympia, WA 98504-0600
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State Representative Matt Manweller, 13th Legislative District
470 John L. O'Brien Building | P.O. Box 40600 | Olympia, WA 98504-0600
(360) 786-7808 | Toll-free: (800) 562-6000