Article by Karen Raymond

The League of Women Voters of Washington opposes ballot Initiative 2109, which would repeal the state capital gains excise tax.  This tax, which applies to only a small number of very wealthy people in Washington, provides critical support for public schools, early learning, and childcare programs. 

The League of Women Voters is a nonpartisan, nonprofit organization that encourages informed and active participation in our democracy.  The League neither supports nor opposes candidates or political parties at any level of government, but it does advocate for policy issues that its members have studied. 

The capital gains tax applies to the profits from the sale or exchange of stocks and bonds and high-end financial assets in excess of $262,00 in one year, indexed for inflation. Gains from the sale of retirement and college savings investments, real estate including family homes, agricultural land, small family businesses, and other transactions listed in RCW 82.87.050 are excluded.  

Fewer than 4,000 people in the state pay this tax.  99.8% of taxpayers do not.  During the first year the tax was collected (2023), nearly $900 million was raised for K-12 education, early learning, and childcare programs.  84% of this revenue came from King County. 

Repealing this tax would be a bad deal for Kittitas County.  While the tax taps mainly wealthy people in King County, the generated funds are spread across the state. According to the Washington Department of Revenue, only 16 Kittitas County households paid the tax last year, yet the state-wide tax helped support the county’s K-12 education expenses as well as an estimated $307,500 in new early learning and childcare expenditures, $159,711 in grants to childcare providers, and two school construction projects (Washington State Budget and Policy Center).   If Initiative 2109 passes, more of the funding for education will be shifted to local communities through sources such as school construction bonds or levies and funding for these early/learning and childcare programs may dry up entirely.

The League of Women Voters supports a tax system that is fair, balanced, and works for everyone.  Yet Washington state’s tax system is one of the most regressive in the nation, because those who earn the least pay the highest proportion of their income in taxes.  According to the Washington Department of Revenue, low-income households pay at least four times as much and middle-income households pay at least twice as much of their income in taxes as high-income households. The capital gains tax is not an income tax, and it does not resolve this inequity, but it does ask the wealthiest to contribute more to help fund an educational system that benefits communities across the state. 

Show your support for local schools and childcare/early learning programs by voting NO on Initiative 2109.

The State League of Women Voters opposes all four 2024 ballot initiatives as bad policy. Learn more about the reasoning at LWVWA.org.

This article was co-published by the Ellensburg Daily Record Newspaper on October 19, 2024. Karen Raymond retired from academic support positions at CWU and currently serves Membership Chair for Kittitas County LWV.