Washington State Tax Question

Roger,

It's some relief to know that this particular tax won't fall totally on WA residents.

I don't disagree with what you say, but at this point in the legislative process, we voters don't get a say. It's all up to our elected reps to solve the problem.

I do think that in economic hard times the state should make do with what it has rather than squeeze more money from folks who ARE having to make do with what they have.

As usual, how it looks to anyone person, depends on where they are standing.
 
Larry H":1ee7skea said:
Roger,

It's some relief to know that this particular tax won't fall totally on WA residents.

I don't disagree with what you say, but at this point in the legislative process, we voters don't get a say. It's all up to our elected reps to solve the problem.

I do think that in economic hard times the state should make do with what it has rather than squeeze more money from folks who ARE having to make do with what they have.

As usual, how it looks to anyone person, depends on where they are standing.
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I always thought that in a representative form of government, they way we voters get our say was by electing our representatives - or if one is truly committed, by running for office. Now days in this state (and others), we tend to do a lot of things through voter initiative. Personally, I'm not too enamored with the initiative process in this state (or others) as I don't think that voters necessarily make the best legislation and often constrain things in ways that reality will not allow. As I always say, think of how stupid the average American is, and then realize that 50% are dumber than that. :lol:

IMHO, the major problem with the state budget now is to a large extent the direct result of a falling economy and corresponding falling revenues. So either we cut services or we raise taxes. Neither will be popular with 100% of the residents.

I'm also slightly amused now to think about all the people I used to hear ranting about the state having too large of a rainy day fund - that was a popular bash against state government not too many years ago. I'd like to see the state have a full 2 year reserve so that we can deal more effectively with difficult economic times in the future. I'd recommend the same for any individual person too but the VAST majority of people don't have that.
 
But in the "fat times" (and especially under this govenor) the State budget grew and grew...and grew...and they spent it all and more....now the fat times have ended FOR US ALL, and they don't get it. Hence, I-960 was passed by a vote of the people and our politicians chose to basically ignore it and suspend it. Now the power is back w/ them and numerous tax increase bills are proposed in Oly this session; even one raising the death tax AND another proposing a state income tax.... :?

I'm done.
See you all on the water.
 
IMHO, the major problem with the state budget now is to a large extent the direct result of a falling economy and corresponding falling revenues. So either we cut services or we raise taxes. Neither will be popular with 100% of the residents.
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raising taxes or cutting services are not the two only choices and one ( raising taxes) is the wrong choice that always degrades the ability to raise revenue. Cutting taxes on business and individuals has always lead to the government collecting more money. Has worked every time its tried. Raising taxes has never raised revenue for the government in the long run.

When Jfk cut the top tax rate it resulted in a growth in business and a growth in the tax collected. Same thing when Reagan followed suite as well as Bush. Under Bush the U.S. government collected more revenue, In dollar and well as a % of the GNP, then at any time in history, unfortunately congress spent at a faster rate then any time in history.

This is why some people get so upset about tax hikes. We have learned < well i have> Thur history that a tax hike is bad and a tax cut, to a certain amount is good. If the Governor ever wanted to really collect more money she would cut the gas tax in half and more people will drive and boat, thereby selling more gas and in the long run collect more money. Works every time its tried.
 
starcrafttom":123hdnc6 said:
[. . .Cutting taxes on business and individuals has always lead to the government collecting more money. Has worked every time its tried. Raising taxes has never raised revenue for the government in the long run. . .
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Like many articles of faith, this one is easily extrapolated to an absurdity. "Always" and "never" are dangerous words. If taxes are zero, so is revenue. If taxes are 100%, revenue is once again zero. Imagine a graph of revenue as a function of tax rate. If you pause to think about the shape of this curve for even a minute, you realize that this old chestnut cannot be true over the length of the curve. (If it were "always" true, no tax could ever raise any revenue.) Now just where the curve flattens and begins to drop is the subject of much debate. It is, however, patently obvious, for instance, that when the federal income tax was raised from zero to something, revenue went up not down.

As noted, this is a representative democracy. I agree that the government spends more than it should, but the public it represents spends more than it should, too. Are spendthrifts likely to elect pikers? I guess the system is working. Private debt is actually much bigger than public debt, so arguably our elected tax raisers are shirking their responsibilities. :)

I have no dog in this fight, no axe to grind - just trying to shed a little light.
 
a tax cut, to a certain amount is good.
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yes to a certain point. yes if taxes are zero raising them will raise more money, but its still theft :wink:

what gets me is not only the amount of taxes but the things it goes to. Most of what our tax money is being spent on is not authorized by the Constitution to the federal government in the first place. so much is wasted or none of the federal government's business in the first place.
 
I've always been interested in seeing the data that would support the idea that much of our taxes are wasted. Whenever I've looked carefully at this, I can find a certain amount of what I would consider waste but in general, I find that most $'s go to support things I care about. IMHO one of the problems is that when individuals or media want to make things look bad, they report absolute $'s and when they want to make things look good, they report it as a percentage of the total. E.g. a $1000 wrench for the military is incredibly wasteful but as a percentage of the total it's a tiny, tiny (but still stupid) mistake.

Our federal gov't budget is about 20% to social security, 23% to defense, 19% to medicare and medicaid leaving 38% to everything else. Our state budget is different as the state has different responsibilities. The general fund is where most of our state taxes and fees go (but not all as some fees are connected to specific expenditures). The general fund goes 42.6% to K-12 education, 9.5% to higher ed, 36.4% to human services with the remainder to other expenses. Now you certainly can argue that some or perhaps all of the "human services" portion is wasted but I think if you look in detail at what it's spent on it would be hard to argue that it's all wasted. I've spent a lot of time in the past looking at K-12 education costs. I personally would find it very difficult to run a good school on what our K-12 schools get per child and almost all private schools cost considerably more per child. In higher ed, an area with which I am quite familiar, I would claim that a fairly small percentage is "wasted". So bottom line, until someone provides detailed data on waste (both in absolute $'s AND a percent of the total) and makes specific suggestions on what to cut, I'll disagree with the idea that much of our taxes are "wasted". I also would not refer to taxes spent on the common good (roads, schools, defense, etc) as "theft".

While this thread started out as a Washington State discussion, I'd also be interested in your specific enumeration what $'s are being spent that are not authorized by the constitution of the U.S. I assume you are referring to the provision that the congress is permitted "To raise and support Armies, but no Appropriation of Money to that Use shall be for a longer Term than two Years" and hence are suggesting that we disband the army every two years :wink: .

Finally, while we are on the topic of waste, what percentage of our personal income is "wasted"? Or better yet, what percentage is spent on stuff we don't really need? For me, the percentage that is spent on things I don't really need - cable TV, mobile phone, wine, boat etc. - is pretty damn high and far higher than the percentage of waste in government. Moreover, I would also claim that the percentage I've lost to dumb decisions or accidental waste (food that's gone bad for example) is probably in the 10% range or more as I'm certainly not perfect. Hence, when I judge those in government, I'm willing to accept the fact that a small percentage of $'s will get wasted due to imperfect decisions (many of which seem obvious in retrospect, just as in my own life).
 
Roger or anyone,

Can you provide a link to a site that shows the total taxes collected and where they are spent in WA. I refer to sales tax, B & O, etc at the state level and to property tax at the county level?

This doesn't apply to most Brats, but if you rent a slip, you will become aware of an additional tax on boaters. That is the state leasehold tax. I pay 12.8% tax on the slip rent. This totals about $700 per year. Add to that 1/2% excise tax paid with the boat registration, and it gets close to $1,000 per year!
 
I've been enjoying this thread both as a consequence of my teaching interests (I teach Gov in a large public university -- Cal State) and as a consequence of whom I am employed by (the state of CA).

On the Gov side, there is a vexing challenge to balance individual liberty with the general welfare -- which is always a perilous balance and a contested terrain. Interestingly the c-brat discussion is as good an indicator of where that balance should be as any academic discussion I've ever heard. Seriously.

One comment I'll make that hasn't yet been offered is this: if invested well, public dollars generate significant returns. When we do economic impact studies of public universities (Cal State & UC), we find that for every $1 invested, the CSU and UC create between $4 and $5 of economic activity in return. And, when we survey large employers in CA we find consistently that the graduates of public universities are what drives much of their economic capacity.

As we now begin defunding both K-12 and public universities in CA, it may well be that the economic losses over time will be far more severe than the dollars saved -- in particular for small businesses which rely disproportionately on state training. I don't know if WA state is different -- I hope for your sake it is. It does seem that California's glory days are behind us.

Great discussion. I may assign this thread to my students along with the Federalist Papers... :lol:

Matt
 
I had to Google this to be sure, but it is not as unfair as it might seem. Private marinas pay property tax but publicly owned ones do not--we don't tax government to pay government. So, in 1976 our representative government decided that since people who rent or lease publicly owned property have an advantage over those who rent or lease privately held property, the public users should pay to level the field. About half the revenue goes to the state and about half to local government to be used for all the same purposes property taxes are used for--fire protection, police protection, schools, etc. People who pay to a public entity will see this fee broken out on their bill but on private property, they probably won't, but they are in effect paying it on the private property as well as it is part of the cost of them doing business.
 
Tortuga":1cx0msu6 said:
. . . if invested well, public dollars generate significant returns. When we do economic impact studies of public universities (Cal State & UC), we find that for every $1 invested, the CSU and UC create between $4 and $5 of economic activity in return. . .
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Ah, the fabled "multiplier effect" - another of those chestnuts that needs to be looked at carefully. Impact studies on everything under the sun (think sports stadiums, convention centers, shopping mall parking lots, highways - virtually anything anybody ever wanted to have built with public money) have "demonstrated" that for every dollar spent, some multiple of that dollar is "returned." The obvious question is, if 1$ in gets $4 out, why not put everything you can get your hands on "in" and get 4 times that amount out? Just like the revenue/tax rate curve, this one is bound to have it's ups and downs.

Finding the right projects and spending the right amounts isn't easy.
 
The obvious question is, if 1$ in gets $4 out, why not put everything you can get your hands on "in" and get 4 times that amount out?
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If only it worked like that it would be me rather than Pacific101 driving that beautiful new Tomcat! :smiled The effect is just that, an effect -- it is not a return. So, for every dollar spent $4-$5 of economic activity is created: staff are able to buy groceries and pay mortgages, small businesses are able to sell IT or carpentry services, students spend money on books, movies, beer and capacino, community members are able to visit UC medical centers -- all of this is economic activity and a necessary component of market economies. There is no pile of cash at the end but the community is able to create and distribute goods and services that would otherwise not be there.


Finding the right projects and spending the right amounts isn't easy.
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Indeed, this is the hard part!

Matt
 
Oly,

Thanks for the explanation.

I rented a slip in Eagle Harbor way back in the early 90's at a private marina and the marina paid the leasehold tax on the underwater state land occupied by the marina. I presume that they also paid property tax on the upland property (buildings, parking lot, etc.) and the floating docks.

It's hard to remember, but I think the leasehold tax was shown on our marina bills as a separate item.

Most businesses want to show the taxes as a separate item, (like showing sales tax on an invoice) so the customer knows its the government, not the business requiring the tax.

In WA we have a 'hidden' tax (hidden from the consumer) as most businesses have to pay whats called the 'B & O' tax. This is a tax on gross receipts which is a few percent. It may not sound like much, but in the end the consumer pays for it.

Note that the business can be losing money (negative profit) and still must pay this tax.

If you add the B & O tax onto the sales tax, the tax rate in parts of WA on purchases gets over 10%.
 
California also has a submerged lands lease "tax" in boats in publlic marinas (I cannot vouch for private marinas, since I never had a boat in one in recent years)--As Larry noted in WA, in Calif. it is also significant. As I recollect it was over $1000 a year for a 46 foot boat.

At one time Calif. was charging Calif. income tax on retirees who had pensions from the state of Calif. but were living out of the state (this was stopped by federal mandate).

At one time in my life, I had over a 50% tax structure when working in Calif. My thought was that I was killing my self (literally--since it lead to a heart attack) and giving half of what I was earning to the state (along with the fact that I volunteered one full day a week teaching in a public facility and did not bill for Medicaid patients (It cost me more in billing costs than I recieved from the state). As Larry points out there are some tax structures which do tax gross income. I find this perticularly unfair, since some businesses have a high overhead for a minimal profit--and the tax may be more than the profit.

Bottom line--both individuals and governments cannot continue on the path of spending far more than their income or receipts.
 
thataway":2xhguvu0 said:
I volunteered one full day a week teaching in a public facility and did not bill for Medicaid patients (It cost me more in billing costs than I recieved from the state).
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Medicaid was implemented on January 1, 1970. Within certain parameters, states had wide latitude as to which services they would provide, the scope of those services, and what categories of persons would be eligible. Costs were and are shared between the states and the federal government, with the "richer" states matched at 50% and "poorer" states receiving a higher percentage of Federal money. At that time I was Chief, Bureau of Health Statistics and Economics for New Jersey's Medical Assistance program (Medicaid). One of my responsibilities was justifying to the legislature why we spent so much and to the professional societies why we spent so little, all with the same set of facts, graphs and charts. .
 
http://seattletimes.nwsource.com/html/editorials/2011132172_edit21statefinances.html

WE want to take the Legislature by the lapels and shake it. The Democrats particularly. The taxing and spending plans now running free in Olympia are their plans, and mostly bad ones.
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Democratic leaders should be focusing on the repair of this state's private sector. Instead they focus on protecting state employees and beneficiaries.
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...legislators now propose taxes on bottled water, pop, candy, cigarettes, pipe tobacco, gasoline, diesel, fertilizer, pesticides, collector coins, private aircraft, corporate directors' pay, canned food with meat in it, coal used in power plants, out-of-state banks offering credit cards, the estates of dead people and the income and retail purchases of live people.

They also propose to jack up fees on interior designers, midwives, tanning salons, nursing homes, appraisal companies, wetland scientists and for ballot initiatives, water rights and deeds of trust.
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But the bulk of the state's financial problem has to be met by cutting what it spends.

The state is not the federal government. It cannot print money or borrow from China. It has to adjust. The private sector has done so. The state must do the same.
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Dang Democrats. And all this time I thought it took both Parties to govern. :?

The private sector has done so. The state must do the same.
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Indeed. Only problem is the state can't lay off school children, prisoners, the indigent sick, first responders, etc. And, the state can't fix a national recession, but states are mandated to pick up the pieces when recessions occur -- at a time when revenues are way down and demand is way up. A nasty catch 22.
 
Not sure why mine is so much lower than the Nancy H but I paid 5% leashold on my slip in 09 and it went up to about 7% for 2010 but that is only about $150 per year so not too much to swallow and about equal to 1/2 tank of fuel in the boat.
 
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