WA Venture Capital Expert Says We Will Regret Passing “Millionaires'” (Income) Tax

Geekwire, considered the leading tech and digital publication in the US, is based out of Seattle.  So is a leading venture capital firm, Madrona (and in CA).   Geekwire recently pointed out an excellent piece written by one of the Madrona partners about the threat of WA state's millionaires tax.

   Expert:  Forget Millionaires title, It's an Income Tax

Writing for The Center Square, WA Policy Board Member and Madrona Managing Director Matt McIlwain says when his company, Madrona Venture Capital, is considering investing in a business or project, they create what's called a "pre-mortem," or information about why that investment might fail in the future.

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He says of course they want it to succeed, but venture capitalists always consider the risks as well as rewards. McIlwain applied this principle to the proposed WA State Millionaires tax.  First off, he says forget that title...it's an income tax (which is actually prohibited by the state Constitution, but legislators don't pay attention to that).

  What are the 3 Big Strikes Against the Tax?

McIlwain writes the three strikes against the income tax are 1) it makes WA state uncompetitive for "talent and investment.'    One of our state's biggest draws for years was no income tax, and even 15 years ago, a resonable tax burden. Not anymore.

2) You will be the next to pay.  He is not the only one sounding this warning. Numerous GOP Leaders from Travis Coture to April Connors (8th District) and dozens of experts say the million dollar threshold could easily be lowered to a few hundred thousand, and even lower---eventually expanding the income tax to everyone.

3) The State Legislature Cannot be Trusted.  He points out the misuse of tax dollars, for example, student spending has increased $10K per child, while test scores fall.  Since 2010,  the state's economy has produced tax revenues that have increased 300 percent, despite our population only growing 15 percent.  He also cites the frequent use of the word 'emergency' by legislators--claiming the state is woefully short of funds, when the opposite is true.

 What's Our State's Future If it Passes?

And finally, McIlwain predicts if the tax passes, in ten years (or less?) WA state will be like many of the 'rust belt' cities in the upper midwest and mid-Atlantic, that allowed these type of policies to ruin their economies. Especially Detroit, Flint and Grand Rapids Michiigan.

He urges citizens, business leaders, basically everyone, to do everything they can to voice their opposition to this tax. Read the full Op Ed here.