Overview
- The Citizen Action Defense Fund and a broad coalition filed in Klickitat County Superior Court on Thursday to challenge the state’s new income surtax.
- Former Attorney General Rob McKenna and former Supreme Court Justice Phil Talmadge are leading the case with plaintiffs that include farmers, builders, small-business owners, the BIAW, the NFIB, and the Ethnic Chamber of Commerce.
- The law adds a 9.9% tax on personal income above $1 million per household starting in 2028 and is expected to raise more than $3 billion a year for programs such as free school meals, an expanded Working Families Tax Credit, and small-business relief.
- The lawsuit argues that income is legally “property,” so any tax on it must be uniform and capped at 1%, which they say the new graduated levy violates.
- Gov. Bob Ferguson said he is confident the state will win, and the case could trigger injunctions and appeals that affect when the tax takes effect.