Kris Johnson, president of the Association of Washington Business, issued the following statement Monday in response to the proposed 2015-17 state operating budget heard by members of the House Appropriations Committee.
“Although this budget makes some important investments in education and social services, it is disappointing for Washington employers, particularly small-business owners, because it proposes to pay for them by raising taxes on small businesses, a group that already pays more than its share of the state’s tax burden. Washington businesses pay more than 54 percent of state and local taxes.
“Raising the state’s gross receipts tax, known as the business and occupation (B&O) tax by 20 percent on services, as this budget proposes, would hit more than 100,000 small businesses hard at a time when most of the state is still waiting for the economic recovery to arrive. In 37 of 39 counties, Washington’s unemployment rate remains higher than the national average and in many counties, including Pacific, Grays Harbor and Okanogan, the unemployment rate is above 10 percent.
“We also have concerns about the proposed capital gains tax. Although it’s described as a tax on high-income individuals, it could impact a wider group than intended, including some small businesses.
“Raising taxes in this climate, and repealing tax incentives that voters have previously endorsed, will make Washington less competitive for many employers, particularly small, family-owned businesses, and will not stimulate much-needed job growth.
“Washington is expected to bring in $3 billion more during the next budget cycle. That’s about a 9 percent increase over the current budget, a rate of growth that most businesses would be delighted to see. Voters have made it clear they want lawmakers to fund necessary services while still living within their means.
“We look forward to seeing the Senate Majority Coalition Caucus’ budget proposal soon.”
About the Association of Washington Business
Formed in 1904, the Association of Washington Business is Washington’s oldest and largest statewide business association, and includes more than 8,300 members representing 700,000 employees. AWB serves as both the state’s chamber of commerce and the manufacturing and technology association. While its membership includes major employers like Boeing, Microsoft and Weyerhaeuser, 90 percent of AWB members employ fewer than 100 people. More than half of AWB’s members employ fewer than 10. For more about AWB, visit www.awb.org.