Washington's 9.9% Millionaire Tax Faces a November Repeal Vote
Washington voters will decide in November whether to keep a 9.9% tax on annual earnings above $1 million signed into law in March. The levy, Senate Bill 6346, has not been collected yet. It already faces a repeal campaign that will show whether income taxes can last in a state without a broad income tax. The Guardian
The repeal vehicle is Initiative 645. It would cancel the tax on household income over $1 million and ban state and local taxes on income. Right-wing groups are leading the repeal drive. Backers claim the millionaire tax would in time spread to more than millionaires.
Gov. Bob Ferguson has said he would veto any plan to extend the tax to lower-earning households. That promise answers the central claim by repeal supporters. It does not remove the second part of Initiative 645, which would block future state and local income taxes entirely.
The money question rests on a narrow base. Opponents of repeal say taxing Washington's 20,000 highest-earning households could raise about $3.5 billion a year. Less than 0.5% of Washingtonians would pay the tax, according to the governor's office. Ferguson had earlier said the tax will raise at least $3 billion. Office of Gov. Bob Ferguson
How SB 6346 works
Senate Bill 6346 was sponsored by Sen. Jamie Pedersen (D-Seattle) and signed by Ferguson at a ceremony in the State Reception Room in Olympia. Ferguson announced support in December 2025 for a tax on income over $1 million in a single year. He said any bill he signs must send a significant share of revenue back to Washington families and small business owners. He later called the House-passed version historic progress toward fixing Washington's unfair system.
For residents, the tax covers all taxable income. For nonresidents, it covers only the proportional share tied to Washington. The base starts with federal adjusted gross income, which is total income minus certain deductions, plus state adjustments, deductions and credits. The first $1 million is exempt for those who owe the tax, much like a high deductible. That $1 million shield rises with inflation, measured by the consumer price index and reset each October in odd-numbered years. Washington Senate Democrats
The law includes credits to avoid taxing the same dollar twice under the state capital gains tax, B&O Tax and Public Utility Tax. It gives a credit for the capital gains tax so income from stocks, bonds and other financial assets is not taxed twice. It does not apply to assets such as homes or property. It does not tax the sale of a home. It does not tax the sale of a small business.
Part of the revenue is set aside for direct household help. The law provides free meals for K-12 students. It ends the sales tax on baby diapers. It sends a check to nearly 500,000 working families. In its first full year, the tax will send more than 41.3% of revenue back to Washington families and small business owners. In its second year, it will send 47.3% back.
The timeline is delayed. The tax would take effect on January 1, 2028. The first returns and payments for 2028 income would be due in April 2029. The state would begin collecting in 2029. A November repeal would therefore stop it before any collection.
Supporters describe the levy as a fix for a regressive code, where lower-income people pay a larger share of income in taxes. The Senate Democrats' FAQ says households earning over $1 million pay around 4% of income in state and local taxes, compared to around 11% for median-income households and 14% for lowest-income households. Supporters cite that gap as the reason for a separate high-income rate.
Why November matters beyond Washington
Washington is not acting alone. Massachusetts, Maine and New York set a separate tax rate for millionaires. Hawaii passed a new millionaire bracket in May. California voters will decide on a proposed one-time 5% tax on billionaires' wealth. Washington's past adds weight. In 2010, voters rejected by wide margins a proposed income tax on earnings above $200,000.
The broader context here is about institutions as well as money. Washington has relied on sales, property and excise taxes. A high-threshold income tax with inflation adjustments, nonresident rules and credits against capital and business taxes would work differently. It aims to reach top-end income while limiting overlap with the capital gains tax and B&O Tax. Whether voters accept that design before any money is collected will shape what lawmakers try in other states.
In my view, the repeal wording deserves a close read. Initiative 645 pairs repeal with a ban on state and local income taxes. That means the vote is not only on the 9.9% rate or the $1 million line. It is also on whether Washington keeps the power to tax income at all. The result will show how lasting targeted high-income taxes are in states where opposition to income taxes runs deep, and how far a veto promise and earmarked rebates can ease fears of expansion.
