Photo by Visitor7/Wikimedia

Photo by Visitor7/Wikimedia

Vetoed tax cut for manufacturers again pushed in bipartisan effort

Bill would lower business and occupation tax by 40 percent over four years.

Legislators are once again pushing for an across-the-board manufacturing tax cut that was vetoed during the previous legislative session by Gov. Jay Inslee.

The bill, which is sponsored by four Republicans and two Democrats, would lower the manufacturing business and occupation tax rate by 40 percent over four years, according to proponents. The reduced rate would be equal to that paid by Boeing and other aerospace companies as a result of a roughly $9 billion tax cut that was approved in 2013 with bipartisan support and the governor’s signature.

The legislation is identical to a manufacturing tax cut that was approved by both Democrats and Republicans—it passed the Senate by 33-16 and the House by 83-10—during last year’s contentious budget negotiations. Gov. Inslee used his line-item veto power to scrap the tax cut, arguing that it was agreed to quickly and without public scrutiny.

Primary bill sponsor Sen. Michael Baumgartner, R-Spokane, and other Republicans contend that last year Inslee agreed to the tax cut but suddenly reversed his position and vetoed it without warning.

“Inslee went back on the agreement to include the bill and did a double cross and lied and vetoed the bill,” said Baumgartner. “Regardless of Jay Inslee being a liar, it was part of the bipartisan budget agreement and it’s good policy.”

“I think there’s still that level of support for it on both sides of the isle,” said Sen. John Braun, R–Centralia, a lead GOP budget negotiator during last year’s session.

He added that the governor is now in an “awkward position” because of his veto of a bipartisan bill and that “he did not do himself any favors and cast a cloud over this legislation.”

Inslee has gone on record in the past saying that neither he nor any of his staff ever agreed to the tax cut, and that it was passed without adequate public scrutiny and input.

“These tax reductions should be considered in a thoughtful, transparent process that incorporates public input and business accountability,” he said in his veto letter last year.

Jaime Smith, an Inslee spokesperson, wrote in an email that the Governor’s Office hasn’t reviewed Baumgartner’s proposal yet.

Twenty-three Democratic House representatives last summer co-signed a letter to the Governor imploring him to veto the tax cut several days before he killed it.

Despite such dissent last year, the tax cut still has bipartisan support.

“I was pushing to have that as part of the budget deal last year. So I was just as frustrated as the other side of the isle when it got vetoed,” said Sen. Mark Mullet, D-Issaquah, a co-sponsor of the bill.

Deputy Senate Majority Leader Andy Billig, D-Spokane, said any potential manufacturing tax cut should have provisions in it that require manufacturers to produce jobs in Washington state, similar to requirements in the Boeing taxcut, that lets the tax cut expire if certain products aren’t produced in the state.

“I’m not against doing it. I’m saying, if we’re going to do it, and say ‘we’re doing it because we need to be equal to what Boeing is doing,’ then we should make it equal to what Boeing is doing and have some accountability provisions,” Billig said. “We’ve got some differing opinions in our caucus but I think the prevailing opinion is that if we’re going to do tax exemptions, they have to have accountability.”

He added that it’s too soon to tell if the bill has legs.

Sen. David Frockt, D-Seattle, said the general notion of reducing taxes for manufacturing has support in the Senate Democratic caucus.

“My colleagues and I would like to have a lower manufacturing rate,” Frockt said.

This report was produced by the Olympia bureau of the Washington Newspaper Publishers Association.


Talk to us

Please share your story tips by emailing editor@kentreporter.com.

To share your opinion for publication, submit a letter through our website https://www.kentreporter.com/submit-letter/. Include your name, address and daytime phone number. (We’ll only publish your name and hometown.) Please keep letters to 300 words or less.

More in Northwest

Stock photo
Masks to be required at K-12 schools in Washington state

State Department of Health updates guidance for 2021-2022 school year

King County Executive Dow Constantine signs an order July 28 to restart inquests into deaths that involved police officers. COURTESY PHOTO, King County
King County to restart inquests into deaths by police officers

Cases include shootings by Kent, Auburn, Federal Way and Kirkland police

t
King County to hire recruiter to fill vacant Sheriff’s Office jobs

50 deputies have resigned this year after 69 resigned in 2020

File photo
Brief history of rats in the Puget Sound region – and the problem they present

Local exterminator noticed big change in rats over the past 40 years.

File Photo
Face covering recommendation in indoor public spaces expands to 7 more counties

King plus Pierce, Snohomish, Kitsap, Clallam, Jefferson, San Juan and Grays Harbor counties

Elaine Simons, former foster mother of Jesse Sarey, addresses a crowd outside the Maleng Regional Justice Center on Aug. 24, 2020, moments after Auburn Police Officer Jeff Nelson was formally charged with second-degree murder and first-degree assault in the May 31, 2019, shooting death of 26-year-old Sarey in front of a north Auburn convenience store. File photo
Supreme Court rules officers can be compelled to testify about killings

In a joint lawsuit against King County, the Washington State Supreme Court… Continue reading

Photo courtesy WSDOT.
Transportation Commission wants your help naming next ferry

Construction of a new, hybrid electric Olympic Class ferry is expected to… Continue reading

Photo courtesy WSDOT
Traffic alerts | July 22

All lanes of SR 99 northbound and southbound at the 1st Avenue… Continue reading

Most Read