Gov. Ferguson sets conditions for $1 million income tax plan after Senate approval

The proposal now moves to the state House, where its fate — and the governor’s conditions — will determine whether it advances further.

Democrats have said the bill is about requiring the wealthy to “pay their fair share” for things like schools, childcare, health care, and essential services.

Republicans argue the tax is both unconstitutional and a gateway to broader taxation. They warn the levy would eventually expand to include more Washingtonians.

“I think as the voters become more educated, as we move forward, they will be with us on this issue and know that this income tax is not just going to hit wealthy people,” Republican Rep. April Connors said at a news conference Tuesday. “It’s going to eventually hit every single person in Washington state.”

Senate Bill 6346, which would impose a 9.9% tax on Washington residents with more than $1 million in annual income, passed the Washington State Senate 27–22 on Monday.

“I think that they’re going to have a harder time passing the income tax in the House than they had in the Senate,” Connors said. “So, we will be working all angles over here to make sure that that doesn’t happen. I just think they’re going to have a harder time here.”

Connors declined to provide details on their strategy.

‘Millionaire tax’ faces scrutiny from Ferguson

Even if the bill survives the House, it still faces scrutiny from Ferguson. The governor has expressed support for a millionaire tax but said he will not sign the bill unless it is “laser-focused” on improving affordability for residents.

“Do I support the concept of a millionaire’s tax? You better believe it, absolutely,” Ferguson told reporters Tuesday. “But — and this is a significant but — it just can’t be three and a half billion dollars that goes into our general fund.”

Ferguson wants roughly $1.9 billion in projected revenue returned to Washingtonians.

He is calling for expanded eligibility for the Working Families Tax Credit, small‑business tax relief, and two new sales tax holidays. One sales‑tax holiday would be over three days; the other would be over two.

“During that time, there’d be no sales tax on items less than $1,000. That would put approximately $141 million back in the pockets of Washingtonians every single year,” Ferguson said.

He has indicated he will demand significant changes to the measure before it reaches his desk.

“We are not there yet, and we are still not close to being there,” Ferguson said.

Republicans insist the issue should ultimately be decided by voters.

“If there’s one thing that they could change, and if it was going to go to the governor, it would be to take out the necessity clause,” Republican Senator John Braun said. “So, this could go to a vote of the people in a referendum like it should.”

Ferguson said he wouldn’t support the idea of a millionaire’s tax if he didn’t think voters would approve it.

“The people will ultimately have their say on this,” Ferguson said. “If this passes the legislature, if it survives a court challenge, undoubtedly, the voters will have their opportunity to weigh in, as they should. I support that. I tend to be a supporter of the initiative process, and this is a big proposal, and I’m glad they’ll have a chance to weigh in.”

Washington Senate passes bill

After nearly four hours of debate Monday, the Senate passed Senate Bill 6346. Lawmakers passed the bill mostly on a party‑line vote, with the majority of Democrats in favor. Democratic Senator Lisa Wellman was among them.

“This is not about penalizing wealthy people, wealthy Washingtonians. It is simply asking for proportionality in our tax structure at a time when the gap between rich and poor has never been greater,” she said before the vote.

“This is a way of changing our direction so that our tax system is adequate to the needs that we face in the 21st century,” said Democratic Senator Jamie Pedersen.

Republican Senator Chris Gildon voted no, as critics say the bill opens the door for a tax down the road on the middle class.

“If this bill passes today, future legislatures can easily come back and change the threshold from $1 million down to $500,000 to $250,000; they can apply it to anyone that they want to,” he said before the bill passed the Senate.

The tax cleared the Senate Ways and Means Committee last week.

Before the vote, Democratic Senator Yasmin Trudeau said the proposal is about “leveling the playing field” between the state’s wealthiest residents and people struggling to make ends meet.

Republican Senator Perry Dozier argued the measure does nothing to make the state more affordable.