Ensuring an Equitable Seattle

by Yurij Rudensky

Seattle needs to become more equitable. Passing an income tax is important to moving toward this goal. But, while necessary, such a change is not sufficient on its own. To make a city that works for everyone, we must tether efforts reforming who shoulders the tax burden with those reimagining how and where our resources are spent. This is because a tax system is only as progressive as the services and institutions that it props up.

As it stands, the way our city raises funds is deeply unfair. But the extent of the injustice may not be so visible on a personal level. A recent report puts us last in the country in tax fairness. We can, on an intellectual level, understand the implications. Our system is backward; our poorest neighbors contribute disproportionately to support our schools, parks, roads, and other shared amenities.

But, on a more concrete individual level, few if any know exactly how much we pay in state and local taxes in a given year. Largely composed of a sales tax, the burden pools in small, steady trickles. To be sure, those struggling to make ends meet feel the pain as account balances dwindle at the end of each month. Unlike the federal system, however, we are never confronted with a complete accounting.

That said, if you make under $65,000 annually, chances are more than 10 percent of your income goes to local and state taxes. This figure increases to 16.8 percent if you make less than $21,000 a year. In other words, it takes more than two months of salary for those already struggling to cover basic expenses to meet their tax obligations. Those on the highest end of the spectrum, in contrast, only need a week. Hidden in plain view, this serves to widen the divide between the rich and the poor. It is an upward redistribution of wealth. A fact that is particularly troubling given already growing inequality and the city’s rapid loss of its communities of color.

And so, in the face of this reality, advocates have urged a change. To give credit where it is due, some of our city leaders have taken up the task.

A few weeks ago, Mayor Ed Murray and Councilmembers Kshama Sawant and Lisa Herbold announced a joint proposal to tax high-income households. It is not a radical plan—only those Seattle residents making more than $250,000 per year individually and more than $500,000 as joint filers would be subject to a two-percent flat tax. Even under this proposal, the percentage of income wealthy individuals will pay in state and local tax will likely be three to four times less than their low-income counterparts.

Still, no matter how incremental, this is a step that deserves full-throated support and gives reason for optimism. Notably, the Mayor’s announcement describes the proposal as a measure “to begin shifting Seattle to a more progressive and sustainable tax structure.” And even though just a beginning, this plan should be applauded, especially if it fulfills its promise to relieve some of the tax burden shouldered by those with lower incomes by reducing sales and property taxes.

But as efforts to dismantle our upside-down system gain traction, equity and fairness require looking beyond how our public funds are levied. They also require assessing and improving access to opportunity. The struggle for a more just input must be inextricably linked to the ongoing fight for a more just output.

This means that the communities served by Rainier Beach and Chief Sealth High Schools must never again be asked to self-fund successful academic programs. That the City Council follows through with reforms to ensure that every renter has an affordable, safe place to live. That Sound Transit does not and cannot “forget” to place a stop in a community of color. That local officials rethink community needs and approaches when it comes to policing and incarceration. This list, with its common thread, can go on. But it need not.

A change in the tax system is necessary and possible. But true systemic change, a change in fundamental fairness, will not come without a holistic approach. This means shifting tax burdens to be more fairly aligned with abilities. This also means shifting benefits to be more aligned with needs.

Featured image Alex Garland

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6 thoughts on “Ensuring an Equitable Seattle”

  1. Has anyone considered that the very wealthy may just up and move to the Eastside. Other high income folks coming to this area may settle on the Eastside rather than be exposed to an additional $10,000 (2% of $500,000) per year or more tax. We all know taxes never go down. It will be 2% this year 3% next and 4% by 2021.

    Seattle looses the property taxes these folks pay. They loose the sales tax because the bulk of their purchases will then be on the Eastside. Their property taxes will also be paid to the state and those communities where they live. Seattle looses again and yet again.

    In addition Seattle businesses will suffer because these wealthy folks will not shop in Seattle, eat in our eateries, purchase our services in Seattle. The businesses that suffer and may need fewer employees. The middle class looses again.

    Add to all of this the fact that it probably is not legal for Seattle to have an income tax and we will spend a lot of city resources trying to defend this tax. Maybe that money should be spent on services here in Seattle.

    Lets think this through along with all of its consequences. The Mayor and City Council are using topic for their political gain. Look! I am for the underprivileged! I am for sticking it to the rich. I am your hero. Do not come to me when you lose your job because of this tax.

    Our city officials are either ignorant – high probability. Are only interested in political gain – very high probability. Know the total effect is very negative to the city and feel it is OK to hoodwink the voters to try and gather votes and raise their political position. To heck with the modest income workers of Seattle who may lose their jobs.

    1. Very true. NYC has a 3-5% income tax rate and everyone knows there are no more high income residents in NY and no one really shops there.

  2. “Has anyone considered that the very wealthy may just up and move to the Eastside.”

    Very true. New York City has a ~3-5% income tax rate and there are no high income residents in New York any more.

      1. Good point. San Francisco, which also has in income tax, is known for its low income residents and plummeting property values.

        We’ve seen it time and again – Clinton raised the marginal tax rate and the economy collapsed; Bush cut taxes and his presidency was the most prosperous decade in recent memory.

      2. Are you talking about the Bill Clinton who had a budget surplus, the first we had seen in many years? Are you talking about George “the W” Bush? As I remember he led us into the second worst depression the country has seen. What did the stock market get to 12,000 or was it below that? He was a clear winner of the worst president we had seeing the last 100 years. Then there is Obama who lead us out of the depression to prosperity that DT is still surfing on. The good news for Bush is DT will probably elevate “W” to the second worst president.

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