By Asa Kowals-Rose
Washington State voters have approved Initiative 1366, a controversial measure backed by anti-tax activist Tim Eyman. The measure will lower Washington State’s retail sales tax by one percent, unless state legislators pass a constitutional amendment to require a two-thirds majority vote in the state legislature for future tax increases. If passed, this amendment would go to voters for approval.
With the state budget is so heavily reliant on sales tax revenue, the impending sales tax cut is meant to leave the legislature with no choice but to propose a two-thirds amendment. This was how the measure was touted; not as a sales tax cut, but a way of making it harder for the legislature to enact tax increases.
In the past, Tim Eyman has successfully run initiatives that do this directly—three times, in fact. In 2007, 2010, and 2012, Washington voters passed Eyman-backed initiatives that established a two-thirds majority rule for tax increases. These measures, however, were struck down by the Washington Supreme Court in the 2013 case, League of Education Voters v. Washington State. The court declared it unconstitutional to require a two-thirds majority vote to raise taxes, since the state constitution only requires a simple majority to do so.
Initiative 1366 was designed to circumvent this ruling; it will require a constitutional amendment to counter the court’s decision, but amendments can only be initiated by members of the state legislature. Supporters of I-1366 feel confident that its passage will produce a two-thirds amendment, which would then be referred to voters. The past popularity of the two-thirds requirement suggests that such an amendment would pass.
Opponents of Initiative 1366 have vowed to challenge the measure in court, claiming that its coercive nature makes it unconstitutional. Constitutional amendments, they argue, must be conceived entirely in the state legislature, and therefore cannot be passed at the behest of a ballot measure. They also claim that I-1366 violates Washington’s single-subject rule, which states that an individual ballot measure may only address one policy issue.
Critics of two-thirds rule sought by Initiative 1366 worry that such a restriction would worsen legislative gridlock, and make it harder for the state to raise the revenue needed to fund state programs. This is a particularly pressing concern in Washington; since August, the state has been fined nearly ten million dollars for inadequately funding basic education—a consequence of the 2012 McCleary decision.
Some blame Washington’s budget woes, including the McCleary decision fines, on the state’s regressive tax structure—the most regressive in the nation according to the Institute on Taxation and Economic Policy. This means that low-income Washingtonians shoulder a greater share of the state’s tax burden than low-income individuals in other states. Many proponents of a more progressive tax system argue that a two-thirds rule will make it difficult to alleviate the tax burden felt by low-income taxpayers, since doing so would likely require new taxes on wealthy individuals. Supporters of Initiative 1366 say that the two-thirds requirement will help to protect low-income taxpayers, by making it harder for legislators to raise their taxes. Creating barriers to tax increases, they argue, will encourage the state legislature to use existing revenue streams more efficiently.