Seattle business leaders issue dire warning over state tax proposals

The Washington legislative session is coming to a close this Sunday, and the clock is ticking to find a way to close a $16 billion budget deficit.

Business leaders in Seattle and King County are sounding the alarm about what proposed tax increases could mean for the state’s economy, businesses, and jobs—especially in the tech sector with startups.

“Our robust tech sector accounts for nearly 1.5 million direct and indirect jobs and represents 22% of the state’s economy,” CEO of Seattle Metro Chamber of Commerce Rachel Smith said.

Tuesday morning, the Seattle Metro Chamber of Commerce held a virtual roundtable to discuss looming tax increases and the short-term and long-term consequences. Also around the table were the Bellevue Chamber of Commerce, Washington Roundtable, and the Association of Washington Business.

They are all concerned that the increased B&O and sales taxes will make it more difficult and expensive to do business. They also worry that companies will leave the state, jobs will be lost, and families will go hungry.

Kelly Fukai with the Washington State Technology Industry Association emphasized the impact of the tech industry.

“For every one tech job, that’s three more jobs created in the state,” she said.

Seattle business leaders voice concerns over tax proposals

Smith argued legislators are making decisions without pausing to reflect on the consequences.

“Legislators are doing this seemingly without regard to the ripple effects—the impact on the overall economic ecosystem, especially to new and startup businesses,” she said. “If approved, the recent state revenue proposal that we’ve seen out of Olympia would result in the largest tax increase in Washington history.”

Raji Subramanian, co-founder and CEO at Stealth AI Startup, worries work will go to waste.

“The progress made by the state on investments in essential infrastructure, innovation proposals, and programs that strengthen communities and create good jobs for Washingtonians, all means nothing if these taxes are approved,” Subramanian said. “We are already struggling to fill open positions, grow and expand. How do legislators think we, and specifically start-ups, can do that if we are hit with huge tax bills?”

The group encouraged lawmakers to address the $16 million state budget shortfall without raising taxes on Washington’s hometown businesses.

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