Rantz: Washington utility, property taxes would surge by 3% under Democrat’s bill

A Washington Democrat introduced a new bill that could jack up utility taxes by 3% a year. But it’s the least of our worries and not the only tax hike Washingtonians should prepare for.

Senate Bill 5088 would allow counties to impose an excise tax “on the privilege of engaging in business as a utility.” The tax may not exceed 3% and must be added to the rates or charges it makes for consumer services. Under the bill, the taxes would be itemized on the customer’s bill.

State Sen. Mike Chapman, D-Port Angeles, introduced this bill to address counties’ concerns over their budget deficits. This bill wouldn’t mandate a tax, but allow the county to impose one at its discretion. And while this bill currently appears unlikely to pass, a second tax is likely will and is guaranteed to raise the cost of living in Washington.

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How will housing costs explode courtesy of Washington Democrats?

Washington Democrats are readying property tax lid legislation as well. Currently, cities cannot impose property tax hikes over 1%. But under the bill, which has yet to be introduced, cities would be able to raise property taxes by 3%.

Both bills come as Democrats have publicly campaigned on the issue of unaffordable housing.

Democrats say housing costs have become untenable for too many people in Washington. They place the blame on developers and corporate landlords, while arguing a lack of government intervention has allowed the housing affordability crisis to worsen, particularly in Seattle and King County.

Yet both bills would dramatically increase the costs of living for property owners, as well as renters who will see the rate hikes reflected via higher rents. Businesses would also be affected.

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Property taxes will surge

Not all Democrats are eager to raise taxes on their constituents.

Federal Way Mayor Jim Ferrell said he would “absolutely not” support a tax levy raise. He says the city has “many thousands of people that cannot afford on people on fixed incomes and cannot afford their property taxes to go up.” But in some cities, residents are unlikely to avoid property tax hikes.

The Association of Washington Cities (AWC) has been pushing for the property tax levy lid increase, including a failed effort in 2024. But this year, a memo from Washington Democrats about their tax plan was accidentally sent to all senators and it leaked. On the list of proposed taxes that Washington Democrats will push include the tax levy lid increase. Cities represented by the AWC include Democrat-controlled Spokane, Tacoma and Seattle.

The success of this bill will hinge on whether or not Democrats will feel empowered to continue raising taxes on Washingtonians, while using a housing affordability crisis to convince their constituents to keep them in power.

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