If there's no state income tax... (Seattle: loan, houses, purchases)

[scirocco22]

The B&O tax is assessed on businesses so if you're not planning on opening a business, don't worry about that one.

Business & occupation tax


The "use tax" can be controversial as it is essentially a sales tax on things purchased out of state.

Use tax


Controversial in the aspect that (like some mentioned previously) if you purchase items in Oregon and intend to use them in Washington, then technically you owe the Use Tax which is essentially the same rate as the Sales Tax on those items. Just like if you ordered something over the internet and didn't pay sales tax, you'd technically owe the "use tax" on those items too. However, how many folks voluntarily fork over that amount to the state? Certain big-ticket items might be handled differently especially if they're delivered and it may be impossible to avoid the Use Tax. Other things like vehicles are virtually impossible.

[jojo7]

As others have mentioned, with no state income tax, Washington does get there money one way or another. I for one prefer not paying a state income tax and have my tax dollar spread out over many different things. I came from a state that has state income tax and I love not having a big chunk out of the paycheck, even though the sales tax was lower. I know people have mentioned high property taxes, however, that depends upon where you are moving from and what you consider high. For us, the property taxes turned out to be much lower than where we use to live. If you can keep your commute down, it will be a big savings since our gas prices are very high. Good luck to you!

[rainbow12345]

"WA does have a HUGE surplus at the moment and seems to be pretty fiscally responsible as compared to some of our neighbors."


we have 8.75 sales tax too in the bay area plus a whopping 9.5% state income tax, and without capital gains tax break, so you guys definitely got a better deal in WA

i wonder why CA is doing worse fiscally even with all the extra revenue

[StealthRabbit]

Originally Posted by rainbow12345

i wonder why CA is doing worse fiscally even with all the extra revenue

I would say WA still has a decent base of worker bees, and fewer 'leeches'. (folks abusing / demanding entitlements). 'Welfare to work' programs have been pretty effective, and deserve our support.

But... the last amnesty program (1980?) created a significant burden to WA communities with large migrant populations. The parents were grateful, but the subsequent generations have become bitter and demanding.

It's a delicate balance when a democracy Gov tries to be a benevolent provider (or policeman...). Not really possible in when the gov is so limited. Works well in a dictatorship if the government is benevolent. (not often the case --- power struggles...).

CA would have done well to retain the capital gains on properties, and only allowed a small portion to leave the state. That would have preserved about 6 neighboring state's ability to provide affordable housing, AND could have covered the huge infrastructure expenses that a large state with very transient population needs.

WA just might have a good balance of power, tho pretty polarized in needs / agenda. We would also be wise to enable that balance to work, and vote intelligently, realizing who might suffer financial ruin (farmers / businesses / government) if we pass our pet projects. I would support some comprehensive information on issues, and bag the propaganda during elections. (wishful thinking...)

[cdelena]

Originally Posted by janb

I would say WA still has a decent base of worker bees, and fewer 'leeches'. (folks abusing / demanding entitlements). 'Welfare to work' programs have been pretty effective, and deserve our support.

But... the last amnesty program (1980?) created a significant burden to WA communities with large migrant populations. The parents were grateful, but the subsequent generations have become bitter and demanding.

It's a delicate balance when a democracy Gov tries to be a benevolent provider (or policeman...). Not really possible in when the gov is so limited. Works well in a dictatorship if the government is benevolent. (not often the case --- power struggles...).

CA would have done well to retain the capital gains on properties, and only allowed a small portion to leave the state. That would have preserved about 6 neighboring state's ability to provide affordable housing, AND could have covered the huge infrastructure expenses that a large state with very transient population needs.

WA just might have a good balance of power, tho pretty polarized in needs / agenda. We would also be wise to enable that balance to work, and vote intelligently, realizing who might suffer financial ruin (farmers / businesses / government) if we pass our pet projects. I would support some comprehensive information on issues, and bag the propaganda during elections. (wishful thinking...)

Janb is right; when your objective it to provide equal opportunity for your citizens a balance is possible, but you go broke when you try to provide equal results for all residents.

[marimari123]

Thanks everyone for the information. I guess Washington taxes the businesses (B&O taxes) instead of the employees? So businesses pay the taxes that individuals would pay as state income tax in other states? Hmm...that makes sense in my head, not sure if I'm typing it out properly.

In any case...thanks again for all of the useful info.

Regards,
mari

[Moon Waffle]

You've got it. Wa St is hard on businesses (B&O tax), easy on residents (no state income tax, no taxes at all on groceries, etc.).

The sales tax may be relatively high but unless you are planning to purchase several hundred thousand dollars worth of sales taxable items every year (house doesn't count in this category), it works out to your favor. I've run the numbers several times.

It's a great place to live for these tax breaks, but as I've said, hard on businesses which is why (outside of the Seattle area where all the resources are) businesses are often not enticed to locate in this state.

[KidBlue]

Actually the B & O tax is not high when you consider the way CA taxes small businesses. CA is ranked the highest cost state to do business in if you own a small business or are an individual providing a service, because you are taxed as an individual. I add the income from my small business to my personal income and then it gets taxed at 9.5 percent by the state and more by the feds just like my regular salary.

Right now I only pay $160 per year to register my car but it used to cost about $600 a year. Then I get to pay property tax and sales tax of 7.75 percent and, remind me why so many people want to live here.......

[Prodigal Coug]

New Mexico has a state income tax that ranges from 1.7% to 5.3%, and a state sales tax of 5%. Property taxes are lower than Washington, but not low enough to offset the income tax (for me, anyway).

When people say "Washington has a high sales tax" ask them "in comparision to what?" There are 20 states with sales tax rates equal to or higher than Washington's.

[Moon Waffle]

KidBlue, in comparison to California, almost every state has low taxes.