There’s a difference between making a legal argument and putting the real strategy in writing. Some legislative leaders and the Attorney General’s office may have just done the latter, and now the Washington Supreme Court has to decide whether it matters.

This week, the State Supreme Court will hear arguments from Let’s Go Washington over whether voters can challenge the state’s new income tax through a referendum—a constitutionally-protected process that allows citizens to gather signatures and put a recently passed law on the ballot for approval or repeal. The income tax, passed by the Legislature and signed by Bob Ferguson last month, includes an “emergency/necessity clause” that blocks that kind of public vote, leaving only the more difficult option of pursuing an initiative instead.

But newly surfaced emails published by The Center Square Washington cut straight to the heart of the issue: There never was an emergency at all.

Leaked correspondence shows the chief architect of the income tax, Senate Majority Leader Jamie Pedersen (D-Seattle) was advised by the state Solicitor General to include the emergency clause not because of any urgent fiscal need, but to prevent a referendum challenge. In other words, the clause wasn’t about an immediate crisis; it was about stopping voters from having a say.

That revelation doesn’t just raise eyebrows—it undermines the entire legal justification for the clause.

Under Washington law, “emergency/necessary to implement the budget” clauses are supposed to be reserved for situations requiring immediate action to preserve public peace, health, or safety. Yet the income tax itself doesn’t even take effect for more than a year. If the revenue were truly urgent, why the delay?

Even more telling is the broader context: Income tax proponents in the legislature claimed an “emergency” to block a referendum, even as the policy they passed won’t generate revenue anytime soon. The contrast is hard to ignore—and it reinforces what the emails make explicit.

The involvement of the Attorney General’s Office adds another layer of concern. Lawmakers have their own legal staff, yet guidance here came from within the AG’s office on how to structure legislation in a way that could avoid voter review.

Former Attorney General Rob McKenna criticized that dynamic, questioning why the office would be involved in advising lawmakers on a strategy that appears designed to sidestep the referendum process altogether.

Current Attorney General Nick Brown responded to the emails this week, but largely brushed off the controversy rather than addressing the substance of what was revealed.

That may be difficult to sustain given Washington voters’ history on this issue. The last ten times an income tax has been on the ballot, voters have rejected it. Blocking a referendum isn’t just procedural—it’s a way to prevent an outcome some lawmakers may not like.

Which brings the issue squarely back to the court.

The State Supreme Court is not being asked to rule on whether an income tax is good policy. It’s being asked whether lawmakers can invoke an “emergency” they apparently didn’t believe in, for the purpose of shutting down a referendum.

The emails make that question unavoidable.

If the court allows the emergency clause to stand under these circumstances, it risks setting a precedent where “emergency” becomes whatever lawmakers say it is, regardless of reality.

And if that happens, the referendum process itself becomes something that can be bypassed whenever it’s politically inconvenient.

If the court rules in favor of allowing the referendum to proceed, there will be only a narrow window to gather the signatures needed to put the measure on the ballot. Thousands of Washingtonians have already signed up to help. You can get ahead of that effort now by pre-ordering your signature sheets here: https://www.letsgowa.com/request_sig_sheets

If there was never an emergency to begin with, voters deserve the chance to decide for themselves.

In a recent Seattle Times op-ed, Chelan County entrepreneurs Lauren and Ben Petter are partnering with the Citizen Action Defense Fund, former state Attorney General Rob McKenna and former Washington Supreme Court Justice Phil Talmadge to challenge Washington’s recently passed income tax. They are the lead plaintiffs in the case:

Through our businesses, we have a unique view into how people are investing in Washington, both commercially and personally. We see when projects move forward, and we see when they don’t. Recently, we’ve seen projects paused or canceled as investment decisions shift. It’s happening in real time.

We’re also seeing something else: people leaving. Friends, business owners, and families making the decision that it’s simply easier to build and grow somewhere else. When that happens, it doesn’t just affect a small group. It impacts jobs, local investment, and the long-term health of the communities we all depend on.

Washington has historically had a competitive advantage. The absence of an income tax, combined with a strong economy and incredible quality of life, made it one of the best places in the country to start and grow a business. That environment is changing.

Read the full article at the Seattle Times.

(The Center Square) - A Democratic lawmaker who voted in support of Washington’s new income tax said he didn’t see anything scandalous in this week’s revelation of emails showing coordination between the office of Attorney General Nick Brown and crafters of the legislation for a “millionaires’ tax”. But he wants a discussion about a wider income tax that isn’t just for people making more than $1 million a year.

As reported by The Center Square, the documents show efforts to skirt a vote of the people and push the issue to the State Supreme Court in hopes of overturning more than 90 years of legal precedent.

Rep. Larry Springer, D-Kirkland, told The Center Square though he supported the final bill as passed, he has major concerns about the impact on small businesses and about bypassing a vote of the people.

“It is a hot button. I mean, it’s like a third rail of politics,” he said. “When that is the case, then you should err on the side of giving everybody their say, one way or the other.”

The Kirkland Democrat made headlines during the legislative session when he said Washingtonians should not believe backers of the income tax who say it will remain only a tax on the wealthy.

In Thursday’s interview, Springer reiterated that he expects should the income tax is upheld by the courts, it will be expanded to lower income earners.

“Any given legislature cannot bind the next legislature. They can do whatever they want. The next legislature can change that pretty easily. So, there’s never going to be a guarantee,” Springer said. “I happen to believe that an income tax is a more fair, equitable, progressive tax. And so, the notion that this could be expanded to others…. there’s the precedent at the federal income tax level.”

Springer said he did not see any issues of concern with the AG and income tax supporters emails to convince him there was anything inappropriate in that collaboration.

Read the full story at The Center Square.

If the Court allows the referendum, the window to collect signatures will be extremely short.

That means we need to be ready immediately.

Pre-register now to receive a signature sheet

Here’s what’s at stake:

📜 This income tax is widely viewed as unconstitutional under longstanding Washington law
⚖️ Lawmakers are attempting to block voters from having a say through the referendum process
🗳️ If approved, this referendum gives voters the power to overturn the tax directly
⏳ But success depends on gathering a large number of signatures — fast

Pre-registering ensures you can start collecting signatures the moment approval is granted.

Even a handful of signatures from your friends, family, and community could make a real impact.

This is a critical opportunity to stop the income tax before it takes hold — but only if enough people step up right away.

➡️ Get your signature sheet mailed to you.

We’ll keep you updated as soon as the Court issues its decision. You can stay up to speed on our Substack focused specifically on this issue or read our Q&A addressing common questions our team is hearing on this issue (also a great resource when talking to lawmakers)..

Thank you for standing up for taxpayers and the rule of law.

A bombshell set of internal emails confirms what many Washingtonians have suspected all along: the so-called “millionaires tax” was never just about the wealthy. Instead, it was designed from the start as the opening move in a much broader push for a statewide income tax—paired with a coordinated legal strategy to make it possible.

According to reporting from The Center Square, emails obtained through public records requests show that the chief architect of the income tax (SB 6346), Senate Majority Leader Jamie Pedersen (D-Seattle), was not only focused on passing the tax initially, but on laying the legal groundwork to expand it far beyond its initial scope.

In an August 27th email, Sen. Pedersen made his ambitions unmistakably clear, writing: “I’d like to start with a rate of 9.99%.” That single line cuts through months of political messaging. While lawmakers have avoided committing publicly to future rate hikes or broader application, the intent expressed privately tells a different story: this was always meant to be a starting point—not an endpoint.

That aligns with longstanding concerns that once a state income tax is established, thresholds drop and rates rise over time, eventually impacting far more people across the state than the narrow group initially targeted.

Just before the income tax bill passed the State House in March, Democrat legislators rejected an amendment that would have made it significantly harder to lower the income threshold and expand the tax to more Washingtonians. That decision raised eyebrows at the time—but in light of these newly uncovered emails, it was a clear signal of what was always intended.

The emails also shed new light on how the policy itself was crafted. Sen. Pedersen directly sought legal guidance from the Washington Attorney General’s Office on how to overturn longstanding constitutional precedent blocking a statewide income tax.

“I would like to force the Washington Supreme Court to reconsider its caselaw that considers income to be property,” Sen. Pedersen wrote.

That precedent—rooted in decades of Washington Supreme Court decisions—has consistently held that income is property and therefore subject to constitutional limits. Instead of working within those constraints, the emails show a deliberate effort by legislative leaders to dismantle them.

In another exchange dated Dec. 6th, Sen. Pedersen sent a draft of the bill to Solicitor General Noah Purcell, stating: “I welcome your thoughts and comments about what will give us the best shot to have Culliton overruled.” (‘Culliton’ refers to the Culliton state supreme court decision, a cornerstone ruling that has blocked progressive income taxes in Washington for nearly a century.)

The Solicitor General is not a legislative advisor—he is the state’s top appellate lawyer, responsible for representing Washington in court and defending state law, including the constitution, before judges. His role is to argue cases, not help lawmakers design legislation to overturn constitutional precedent. That’s what makes this coordination so troubling.

Lawmakers have their own legal resources, including nonpartisan staff attorneys tasked with advising on legislation that they rely on during the legislative session to craft bills. The fact that Sen. Pedersen appears to have bypassed those channels and instead worked directly with the Attorney General’s Office raises further questions about the intent behind these conversations.

The implications are significant. Rather than simply proposing a new tax, lawmakers were coordinating with the state’s top legal officials to engineer a test case designed to overturn constitutional protections.

This crosses a fundamental line. As Citizen Action Defense Fund Executive Director Jackson Maynard put it in The Center Square story, “The Attorney General’s role is to defend the constitution, not help the legislature find ways to violate it.”

That critique goes to the heart of the issue. The Attorney General’s Office is tasked with upholding the law as written—not assisting in strategies to sidestep it. Yet these emails suggest a level of coordination that raises serious questions about whether that line was crossed.

The revelations don’t stop there. The emails also show the bill’s “emergency clause—a provision meant only for true, immediate crises—was added at the recommendation of the Solicitor General.

In a Dec. 11th email, Purcell wrote, “I did not see an emergency clause. Without one, someone could try to subject the bill to a referendum. It should not be subject to referendum because it raises revenue, but under the Secretary of State’s longstanding practice, they only reject proposed referenda if the bill has an emergency clause, so someone would have to sue to prevent a referendum on the bill as written. I just wanted to make sure you were aware of that.”

There is clearly no actual emergency here. The tax doesn’t even take effect until 2028, underscoring that this was not about urgency; it was about avoiding voter review.

That has major implications for the legal fight involving Let’s Go Washington. At issue is whether the emergency clause can be used to prevent a referendum challenge. If the court finds the clause was improperly applied, it could clear the way for voters to weigh in directly.

Taken together, these emails reveal far more than routine legislative strategy. They expose a coordinated effort to build, defend, and shield a new income tax: start with a narrow group, work with the state attorney general to overturn constitutional barriers, and use procedural tactics to limit voter input.

For months, supporters have framed the measure as a narrow tax on the ultra-wealthy. These emails tell a very different story—one where a 9.9% rate is just the beginning, and where the ultimate goal depends on rewriting the rules so the tax can reach far beyond its initial targets.

Washington voters have rejected income taxes multiple times. What these revelations make clear is that this latest effort was never just about policy; it was about changing the legal playing field and limiting the public’s ability to stop it.

And that may be the biggest bombshell of all.

Today is Tax Day—and with Washington’s new income tax making headlines, there are a lot of questions. Here are straightforward answers to some of the most common ones we’re hearing.

Also, over the next several months, many lawmakers will be holding town halls and community events, giving constituents a chance to ask them directly about this policy. This Q&A can be an excellent resource to draw from for basic questions, or if a lawmaker is potentially misrepresenting what the recently passed income/”millionaires” tax bill actually does or does not do.

You can also look up and email your lawmakers here.

1. Can you explain who is subject to the new income tax and when it first takes effect, so people understand clearly whether it applies to them?
   The tax applies to individuals with income above $1 million, beginning on the effective date set in the law. While it is currently limited to high earners, there is no legal barrier preventing future lawmakers from lowering the threshold or expanding who is subject to it. The income tax would also impact most small businesses owners because they operate as S corporations, LLCs, partnerships, and sole proprietorships – meaning business profits are reported on the owner’s personal tax return.

2. For residents who won’t owe the tax, will there be any new filing or reporting requirements they should be aware of?
   No, residents who do not meet the income threshold are not expected to have new filing or reporting requirements under the law.

3. What safeguards are built into the law to ensure the tax remains limited to the highest earners and doesn’t expand to middle- or lower-income residents over time?
   There are no binding safeguards in the law that prevent future changes. The income threshold and structure can be modified by a simple majority vote of the legislature. During debate on the bill in the State House, a proposal that would keep the threshold at $1 million was voted down by Democrats.

4. How does the tax treat small business owners whose income passes through personal tax returns, and what steps were taken to avoid unintended impacts on local businesses?
   Income from pass-through businesses is counted toward the threshold, meaning many small business owners (S corporations, LLCs, partnerships, and sole proprietorships) will be subject to the tax based on how their income is reported. The law created a workgroup to study potential impacts, but it does not have authority to make binding changes.

5. How does the tax apply to married couples, and what considerations guided the decision to balance fairness across different household types?
   The law provides a single $1 million threshold, which does not scale proportionally for married couples compared to federal tax treatment. As a result, dual-income households reach the threshold more quickly (i.e. if their income is more than $1 million combined) than under a system that adjusts for filing status.

6. What research or modeling informed expectations about how high-income taxpayers might respond, and how confident are lawmakers in the long-term stability of the revenue? Does the experience with the estate tax being lowered this year due to taxpayer departures provide an example?
   Revenue projections are based on economic modeling, but taxpayer behavior—such as relocation or restructuring income—introduces uncertainty. We know some millionaires have left or will leave the state to avoid paying this tax. As a result, long-term revenue stability is fair to question.

7. If revenue varies from year to year, how did lawmakers plan to protect the programs this funding is meant to support?
   The law does not include a dedicated stabilization mechanism. If revenues decline, the state would need to rely on the general budget process, which could involve spending adjustments or lowering the income tax threshold, so it impacts more Washington families and individuals.

8. Where is the revenue directed, and what accountability measures ensure it is used as promised rather than replacing existing funding?
   Just 5% of the revenue is directed to the Fair Start for Kids program, while the rest goes into the state’s general fund. Because lawmakers can spend general fund dollars however they’d like, there is no strict guarantee the revenue will supplement rather than replace existing spending.

9. Why did the legislature choose to enact this policy through legislation rather than a ballot measure or constitutional amendment, and how does that approach support timely or effective implementation?
   Simply put, it could fail at the ballot. Washington voters have rejected income tax proposals the last ten times they’ve been given the choice. During the legislative process, the majority party also rejected amendments that would have allowed a public vote or made one easier to trigger. The bill even includes language intended to block a referendum—an easier path for voters to weigh in—though that provision is now being challenged in court.

10. Many of the ‘high-earners” that will be subject to this tax are family-owned businesses. Why are public companies like Microsoft, Amazon, Starbucks and others not also subject to this tax?
    Because the tax is structured as a personal income tax, not a tax on businesses themselves. Large public companies like Microsoft, Amazon, and Starbucks pay the same as those family businesses, such as the state B&O tax, sales tax, property taxes but their profits are not taxed at the entity level under this policy. In contrast, many family-owned or closely held businesses are structured as pass-through entities, meaning their income is reported on the owner’s personal tax return, making it subject to this tax if it exceeds the threshold.

KENT, Wash. — Curt Nuccitelli is used to juggling rising costs, tight margins and tough competition. Now he worries Washington’s new millionaires tax could make it even harder to run his business — and eventually push prices higher for customers.

Nuccitelli owns Spirit Transport Systems, a 14-employee trucking company in the Kent Valley that moves goods through the ports of Seattle and Tacoma. In an industry where competition is tight, raising prices isn’t always an option.

Click here to read the full article.

Washington’s newly enacted income tax has already triggered legal challenges from multiple directions. While a state income tax like this seems plainly unconstitutional on its surface, the legal process from here on out is quite nuanced.

Here’s a straightforward breakdown of what’s happening, who’s involved, and what it could mean.

What are the current legal challenges, and who’s behind them?

Two major efforts are underway.

First, Let’s Go Washington filed a referendum seeking to overturn the income tax. That effort was rejected by the Secretary of State, prompting an appeal to the Washington State Supreme Court. The Court has agreed to hear the case, with a decision expected soon.

Second, Citizen Action Defense Fund has formally launched a constitutional challenge. The group is assembling a bipartisan legal team that includes former Attorney General Rob McKenna and former Washington State Supreme Court Justice Phil Talmadge. Their case focuses on whether the income tax violates the state constitution.

What’s the difference between a referendum and an initiative, as far as Washington State law is concerned?

According to a handbook from the Secretary of State, a referendum allows voters to approve or reject a law already passed by the legislature. It’s a straightforward up-or-down vote.

An initiative, on the other hand, is used to propose new laws.

There are also key procedural differences. Referendums require signatures equal to 4% of the votes cast in the last gubernatorial election, while initiatives require 8%. Referendums also give petitioners more control over the ballot language, whereas initiative language is written by the attorney general and often subject to extended legal review. This has been a point of controversy in recent initiative efforts, as the framing of the ballot language can significantly impact the outcome.

There are also two types of initiatives, and petitioners must select one at their initial filing, before collecting signatures:

1. An initiative to the legislature. Once sufficient signatures have been collected and certified by the Secretary of State, the matter goes before the state legislature. The legislature is then constitutionally required to prioritize it above all non-budgetary matters—although there’s no real enforcement mechanism to this, and legislative leaders have been happy to ignore it in recent years. However, if the initiative is voted on by lawmakers and receives a simple majority support, that’s it—it becomes law . If it is rejected or not voted on by lawmakers, it goes to a vote of the people at the next general election.

2. An initiative to the people. This is similar to the process above, except it does not go to the legislature above, and goes directly to a vote by the people once certified by the Secretary of State.

Why was Let’s Go Washington’s petition rejected by the Secretary of State?

The rejection centers on the “necessity clause” included in the income tax legislation. Supporters of the bill in the legislature declared the tax “necessary for the support of the state government and its existing public institutions,” which means the law cannot be challenged by a referendum. Remember, it’s far more effective to challenge something as a referendum than an initiative, because the signature count is lower, and the language appearing on the ballot is far less susceptible to manipulation by opponents.

The justification for the necessity clause is weak, especially since the tax is not expected to generate revenue for several years. If the funding were truly urgent, lawmakers would have raised taxes in a way that generated revenue more immediately.

The income tax’s chief architect, Sen. Jamie Pedersen (D-Seattle), has said the recently passed state budget is balanced “ONLY because of revenue from the Millionaire’s Tax,” as if it’s somehow impossible to address state spending, which has now tripled over the last decade.

An amendment (2548) to remove the necessity clause was pushed by Republicans in the 24-hour debate in the State House back in March, but it failed to pass, in a largely party-line vote.

When will we know the outcomes?

Let’s Go Washington expects a decision from the State Supreme Court on its case by the end of April.

Citizen Action Defense Fund’s lawsuit will take longer, stretching into 2027. That timeline could coincide with changes to the court itself, as there will be at least three new justices in 2027, and five seats will be on the ballot this November.

If the Washington Supreme Court rejects Let’s Go Washington’s lawsuit, what does that mean?

If the Court upholds the necessity clause, it could set a significant precedent. Lawmakers could easily include similar language to future tax increases of any sort, effectively insulating them from referendum challenges.

This would dramatically limit voter oversight and completely neuter their most powerful tool to hold lawmakers accountable—an outcome that would be fundamentally anti-democratic.

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The outcome of these cases will shape not only the future of the income tax, but also how Washington handles voter-approved checks on legislative power. With multiple legal paths unfolding at once, clarity may take time—but the decisions will carry long-term consequences for both taxpayers and policymakers.

You can follow developments on these cases and sign-up for email updates at IncomeTaxWashington.com or directly from Let’s Go Washington and Citizen Action Defense Fund.

Author Viet Nguyen, a Seattle-based technology communications executive and former president of 5G Americas, argues that Washington’s new income tax, though aimed at high earners, represents a clear break from both voter intent and long-standing constitutional precedent. Drawing on his own experience and review of the law, he warns the policy opens the door to broader taxation that could eventually reach far beyond its current scope.

I arrived here as a 17-month-old refugee from Vietnam in 1975. I built my career here, starting out volunteering on Gary Locke’s gubernatorial campaign in 1996, to running local races on both sides of the aisle. Then I spent nearly two decades in technology communications at Microsoft and T-Mobile, and as president of a national wireless industry association. I don’t earn a million dollars a year. I won’t owe a dime under ESSB 6346. But I believe this will be one of the most consequential mistakes Olympia has made in a generation.

I’m not writing to defend millionaires. I’m writing because I read the bill, read the case law and wrote directly to Sen. Jamie Pedersen, the bill’s lead sponsor, to understand the legal policy reasoning. His response did not resolve my concerns. It deepened them.

Start with what the Legislature actually did. In 2024, lawmakers adopted Initiative 2111 by overwhelming margins of 76-21 in the House and 38-11 in the Senate. That initiative banned Washington from taxing “any individual person on any form of personal income.” Less than two years later, the same Legislature made an exception to that ban, in the same bill that needs the exception to be legal. If they genuinely believed this tax was an excise and not an income tax, they wouldn’t have needed to amend I-2111 at all. That amendment is a legislative admission that this is exactly what it appears to be: a tax on personal income.

Read the full op-ed at the Seattle Times.

Viet Q. Nguyen, a Seattle-based technology communications executive and former president of 5G Americas, highlights that Washington’s new income tax is being framed as limited, while warning that similar policies elsewhere have expanded far beyond their original scope. He argues the measure reflects a broader pattern of incremental tax growth that ultimately reaches far more people than initially promised.

On March 30, 2026, Governor Bob Ferguson signed ESSB 6346 into law, imposing a 9.9% tax on personal income above $1 million. It was the first income tax passed in Washington State since 1935.

To get there, the Legislature had to do something remarkable. In 2024, lawmakers had adopted Initiative 2111 by overwhelming bipartisan margins (76-21 in the House, 38-11 in the Senate), banning the state from taxing “any individual person on any form of personal income.” Less than two years later, the same Legislature amended that ban to carve out an exception for the new tax. They also attached an emergency clause to prevent voters from challenging it by referendum, even though the tax doesn’t take effect until 2028.

The bill’s supporters call it an excise tax on “the receipt of income,” not an income tax, because Washington courts have held since 1933 that income is property and a graduated income tax violates the state constitution’s uniformity clause. The bill’s opponents call it exactly what it is: a graduated income tax with a different label.

Both sides are going to court. Former Attorney General Rob McKenna and the Citizen Action Defense Fund have filed a constitutional challenge. The Freedom Foundation is expected to follow. Republican legislators are collecting signatures for a ballot repeal. The case will likely reach the Washington Supreme Court, where five of nine seats are turning over by November 2026.

Read the full essay on X here.

With the signature of Governor Bob Ferguson, Washington has broken its century-long streak of rejecting a state income tax. But for those who value constitutional limits and taxpayer protections, the message is clear: the governor’s signature is not the final word, and the end result is very much yet to be decided.

The 2026 legislative session in Olympia was defined by a rush to upend Washington’s tax structure despite overwhelming public opposition and clear legal precedent. Now that the bill has been signed into law, the battleground shifts from the steps of the Capitol to the courtroom.

The Citizen Action Defense Fund (CADF) and former Washington State Attorney General Rob McKenna have already announced they are preparing a major legal challenge to this unconstitutional overreach. Their argument is rooted firmly in the Washington State Constitution, which has long been interpreted by the courts to prohibit a graduated income tax.

As McKenna and CADF have noted, this is a direct assault on the constitutional rights of Washingtonians. The challenge focuses on the fundamental legal truth that income is property, and under our constitution, property taxes must be uniform. By targeting specific brackets, the new law ignores a century of settled law in a transparent attempt to open the door for a permanent, expansive income tax system.

This follows a familiar playbook in Olympia. Just as we saw with the capital gains tax—which proponents insisted was an “excise tax” despite it looking and acting like an income tax—majority lawmakers are betting they can bypass the state constitution.

But Washingtonians aren’t fooled. History shows that these taxes, while initially marketed as a “tax on millionaires,” some small business owners are included—and it will inevitably expand to capture the middle class to fund ever-growing government spending.

While the lawyers head to court, the most important work continues in our communities. To support this effort, Future 42 has launched a dedicated resource hub and Substack specifically designed to provide the tools you need to stay informed and take action.

This site serves as the central hub for the movement to stop the income tax, offering a deep dive into what this tax will actually do to our state’s economy and how it will impact your family’s bottom line.

You can visit IncomeTaxWashington.com to track the progress of the legal battle and learn more about the roadmap to victory. You can also sign up to get involved in the statewide effort to repeal this tax and protect our state’s future.

The Governor may have signed the paper, but the final word belongs to the Constitution—and to the people of Washington. Join the effort to ensure Washington remains a place where families and businesses can prosper without the burden of an unconstitutional income tax.

Media Contact:

Paige McElwrath

Director of Communications, Citizen Action Defense Fund

paige@citizenactiondefense.org | (503) 863-4846

FOR IMMEDIATE RELEASE

March 30, 2026

CITIZEN ACTION DEFENSE FUND AND ROB MCKENNA PREPARING LEGAL CHALLENGE TO UNCONSTITUTIONAL INCOME TAX

Olympia, Washington — The Citizen Action Defense Fund (CADF) announced today that it is preparing to file a lawsuit to challenge the constitutionality of the income tax that Governor Bob Ferguson is signing into law today, March 30, 2026.

Following the release of a legal memorandum during the legislative session authored by former Washington Attorney General Rob McKenna outlining the measure’s constitutional defects, CADF has retained McKenna to lead the anticipated litigation effort. The organization expects to file suit within the next few days.

As detailed in the memorandum, the legislation imposes a graduated tax on income, which has long been classified as property under Washington law and its Constitution. As such, this income tax passed by the legislature violates the uniformity requirement and constitutional limitations on property taxation established under Article VII of the Washington State Constitution.

“Washington’s constitution is clear, and the courts have been equally clear for nearly a century—income is property, and progressive income taxes are unconstitutional under existing law,” said lead counsel Rob McKenna. “If the State proceeds with the new income tax, it will create a direct conflict with binding precedent and the constitutional protections that safeguard taxpayers. We are preparing to challenge the tax in court.”

CADF Executive Director Jackson Maynard emphasized that the organization is moving swiftly to ensure Washingtonians are protected from unlawful taxation.

“Since lawmakers and the Governor have chosen to ignore both the constitution and decades of settled case law, we will act,” said Maynard. “This lawsuit is about upholding the rule of law and ensuring that Washingtonians are not subjected to an unconstitutional tax scheme.”

About Citizen Action Defense Fund
The Citizen Action Defense Fund is a 501(c)(3) nonprofit organization based in Olympia dedicated to protecting constitutional rights, promoting government transparency, and holding public officials accountable through strategic litigation and advocacy.

Washington’s constitution has long treated income as property—and that classification comes with strict limits. Property taxes in Washington must meet two clear requirements: they must be uniform, meaning the same type of property is taxed at the same rate, and they cannot exceed a 1% cap.

The proposed state income tax violates both.

First, it applies only to certain individuals—those earning above $1 million—while exempting others entirely. That is not uniform taxation. Second, the rate itself is far beyond the constitutional limit, reaching roughly 10%, which is ten times higher than what is allowed for property.

Supporters argue the policy targets only high earners, but the legal issue isn’t who is taxed—it’s how. Under the constitution, income as property must be treated consistently and within strict boundaries.

The constitution can be amended, of course, but that requires a vote of the people. Washington voters have rejected an income tax the last ten times they’ve been given the choice. This time, proponents avoided that process—rejecting amendments that would have allowed voters to weigh in directly.

Read the full Legal Memorandum regarding the constitutionality of the state income tax from former Attorney General Rob McKenna here.

From the House Bill report for ESSB 6346:

Distribution of Revenues. The new tax revenue will be deposited in the State General Fund to fund the tax relief in the act, including the new sales and use tax exemptions, the expiration of sales taxes on certain services enacted in 2025, the expansion of a small business tax credit, and the WFTC program, including its expansion. Each fiscal year, beginning July 1, 2029, 5 percent of the revenues will be transferred from the State General Fund to the Fair Start for Kids Account.

From the Washington Policy Center:

Democrat lawmakers have long advertised an income tax as being about “fairness” and providing “real tax relief” to the working class. The income tax proposal released yesterday does neither.

According to House Republicans, less than 5% of the projected revenues from the income tax would go toward tax relief. The bill includes a minuscule amount of tax reductions: a sales tax exemption on certain hygiene products, an expanded working families tax credit for young adults aged 18-24, and a doubled B&O small business credit from $55 to $110 per month. The B&O filing threshold would also rise from $125,000 to $250,000.

90% of the revenue, projected to be between $3-4 billion annually, would go to the general fund. This income tax proposal is entirely about a new revenue stream, not tax reform.

Bill Summary

Senate Bill 6346 would impose a 9.9% tax on income above $1 million, effective January 1, 2028. The tax base is your federal adjusted gross income, which can be found on line 11 on your 1040. Because this captures total income rather than just wages, it hits business owners, retirees, and anyone with investment income.

The standard deduction is $1 million per individual, but married couples are forced to share that same $1 million combined. This creates a massive marriage penalty. For example, two single people each earning $700,000 owe nothing. If they marry, they suddenly owe 9.9% on $400,000 of their combined income. That is nearly $40,000 in new taxes just for signing a marriage certificate.

The residency rules are equally aggressive. You will be subject to the tax if you’re domiciled in Washington or if you maintain a home here and are present for more than 183 days. The bill counts any portion of a calendar day as a full day. If you spend an hour in Washington, it counts as a full day.

Nonresidents still owe tax on Washington-source income, including wages earned here, business income, and pass-through income from Washington businesses. The tax also applies to professional athletes and college athletes who earn money off their name, image, and likeness (NIL).

While the bill includes credits to offset double taxation, they do not go far. The B&O credit covers only a small fraction of the new tax bill. From my calculation, a business owner with $3 million in income would owe about $168,000 in new income tax after the credit.

The capital gains credit is even more deceptive and convoluted. It’s structured to look like it prevents double taxation. It doesn’t.

Under current law, the first $278,000 in capital gains is tax-free, gains between $278,000 and $1 million are taxed at 7%, and gains over $1 million are taxed at 9.9%.

Under this bill, none of those exemptions matter if your total income exceeds $1 million.

For example, assume you earn $900,000 in salary and sell stock for a $200,000 gain. Under current law, that gain is completely exempt. But under this bill, your total income is $1.1 million, so you owe 9.9% on the $100,000 over the threshold, nearly $10,000. That $200,000 capital gain, which was previously exempt, has now pushed you into the income tax threshold.

It gets worse with larger gains. Let’s say you earn $900,000 in salary and have $1.5 million in capital gains. Under current law, you’d pay nothing on the first $278,000 in capital gains, 7% on the next $722,000, and 9.9% on the final $500,000. You’d end up paying about $100,000 in capital gains tax.

Under this income tax proposal, assuming the same income of $2.4 million, you’d owe 9.9% on $1.4 million, or about $138,600. You get a credit for the $100,000 in capital gains tax you already paid, leaving $38,600 in additional income tax.

Add those together and you get $138,600, which is exactly 9.9% of your full $1.4 million over the threshold. The 0% bracket, the 7% bracket - none of it will matter. Every dollar over $1 million will get taxed at 9.9%, one way or another.

The bill amends Initiative 2111, which voters passed in 2024 to prohibit income taxes. Voters said no, and the legislature said yes anyway.

Lastly it also includes an anti-referendum clause by declaring the tax “necessary for the support of the state government and its existing public institutions,” language that mimics the constitutional exemption for referendums. Normally, opponents could collect signatures from 4% of voters, suspend the law, and let voters decide at the next election. This clause blocks that path. Instead, opponents would have to pursue a full initiative, which requires twice as many signatures and takes longer to qualify.

This bill won’t solve the deficit, won’t make the tax code fairer, and won’t provide meaningful relief to working families. What it will do is create a new revenue stream that lawmakers will spend, setting up the next deficit and the next tax increase. And when that happens, the income threshold will drop, just like it has everywhere else that has an income tax.

Read more about why an income tax is a bad idea: 10 reasons why an income tax is a bad idea for Washington, and contact your legislators about this bill on our new Take Action page: Stop the Costly Income Tax

At a high level, Sen. Jamie Pedersen’s Senate Bill 6346, establishes a 9.9% tax on household income exceeding $1 million. Once signed by Governor Bob Ferguson by the April 4 deadline, the tax will take effect January 1, 2028, with first payments due in 2029. The bill includes a marriage penalty, as the $1 million threshold does not double for joint filers. While it excludes real estate and certain retirement income, the combined marginal rate in Seattle could reach 18%, the highest in the nation. Legal challenges are expected based on 93 years of state precedent regarding income as property.

Read the full breakdown of the bill at IMI Daily.

Nate Nehring, member of the Snohomish County council and Future 42 Snohomish County director, was featured in the Seattle Times with an op-ed about how budget shortfalls are the result over overspending, not a lack of revenue. From the article:

Despite the largest tax increase in Washington’s history, we continue to hear from legislators that we are facing a budget shortfall. The question must be asked whether this shortfall is truly the result of insufficient tax revenue, or whether a reduction in spending should be part of the solution. In a poll published last year by the Seattle Metro Chamber, 76% of voters in Washington agreed that the state has more than enough money to address important priorities.

In just a single decade, state spending has nearly doubled from $43.6 billion in 2016 to $85.3 billion in 2025, according to the state’s Fiscal Information webpage. So, while Washington state residents and businesses are subject to record levels of taxes, legislators are approving budgets which spend twice as much as they did a decade ago.

I would submit that if the average Washington family or small business doubled their annual spending, they would expect to see far greater results from that spending than what we currently see from our state government. And if that family or small business faced a budget shortfall, as one might anticipate after having doubled their annual spending, I am confident they would look first to reduce spending to more appropriate levels before viewing the situation as a revenue problem.

Read the full article at the Seattle Times.

The Wall Street Journal Editorial Board again covers the Washington State income tax and how the supposed tax on millionaires
will inevitably capture the middle class.

Democrats say the tax plan is popular but then why are they including a provision to prevent it from being overturned by voter referendum? Bill section 1107 says the tax imposed by the act “is necessary for the support of the state government and its existing institutions.” According to the Washington Policy Center, the Washington Legislature Bill Drafting Guide says that a “necessity clause” or “emergency clause” protects legislation against voter referendums.

Republicans in the minority can’t stop the bill, but they did their parliamentary best to slow its passage with proposed amendments that put lawmakers on the record on key issues. By Tuesday Democrats had rejected more than 50 amendments to the bill, including one to require a constitutional amendment to allow a state income tax.

Once the state’s constitutional guardrails come off, middle-class Washingtonians know tax-and-spend Democrats will be coming for them next. That’s what happens in every state that has introduced an income tax. Spending soars with the new revenue, and politicians demand even higher taxes. The rate starts low, or at a high level of income, but the rate inevitably gets higher and the income threshold lower. It’s a slow form of fiscal suicide.

Read the full article at the Wall Street Journal.

Photo: State Sen. Manka Dhingra, TVW