If there's no state income tax... (Redmond, Wenatchee: foreclosed, vehicle registration, daycare)

[Ruth4Truth]

Originally Posted by marimari123

What taxes do residents of Washington pay? If there's no state income tax, then how does the state or local government "make up" for that money?

Is it all just property tax? What about people who don't own homes?

We're interested in moving to Washington (Seattle area) and no state income tax seems too good to be true...so what's the catch?

Thanks so much.

Regards,
mari

Pretty much. Property taxes are higher than in California, where people are constantly complaining about high property taxes . And the sales tax is pushed to the limit, but then, so is the sales tax in a lot of states that do have state income tax. CA has close to the same sales tax rate as WA. They're pushing the limit on double-digit sales tax. WA also doesn't have a capital gains tax. It's kind of a tax haven for the wealthy, to a degree.

I think the real answer to your question is that WA doesn't effectively make up for that money. WA in some ways has always been on a tight budget. The State has been cutting funding to higher education since around the 80's, if not before. I'm sure there are other areas of shortfall, too.

WA gets some corporate tax from Boeing, Microsoft and Amazon.

[Ruth4Truth]

Originally Posted by Prerns

How are the taxes in comparison to California as taxes in California are very high..

Property tax is lower in CA. Sales tax is the same. Gas taxes seem to be close to the same. CA has a state income tax and state capital gains tax, though, which WA doesn't have. Car registration may be higher in CA. Is there a tax on food and medicine in CA? Not in WA.

[Yakscsd]

Originally Posted by Mark S.

REALLY high sales tax. ... And registering your car almost takes a second job.

This is all perspective. I find vehicle registrations here to be ridiculously cheap. I also find the sale tax to be about average or just barely higher than many places.

OP, most of the revenue outside sales tax comes from a very onerous business tax on every dollar of sales through your business business. Not every dollar of profit, but every dollar of gross sales! Its like a franchise tax.

[Hemlock140]

Originally Posted by Yakscsd

This is all perspective. I find vehicle registrations here to be ridiculously cheap. I also find the sale tax to be about average or just barely higher than many places.

OP, most of the revenue outside sales tax comes from a very onerous business tax on every dollar of sales through your business business. Not every dollar of profit, but every dollar of gross sales! Its like a franchise tax.

Yes, as a former small business owner, I was subject to the state Business & Occupation tax, on gross sales, and in Bellevue they have another one on top of the state tax. Some cities like Seattle and Redmond also have a head tax on employees. The real cash cow is the property tax, though. Here in Sammamish we have little business and no industry, but the city did very well throughout the recession, because of the cash on hand from the high property values resulting in great tax revenue. They only laid off some of the permit department staff. They had money to pay them but no work for them to do when building stopped.

[509]

[quote=Ruth4Truth;36394081
WA gets some corporate tax from Boeing, Microsoft and Amazon.[/QUOTE]

Not true anymore. Basically small business and consumers pay most of the taxes in Washington state.

The Washington State Office of Financial Managment published a paper that showed corporations receiving state tax breaks pay ONLY 4.5% of the state B&O tax. That includes Boeing, Microsoft, Weyerhauser, PacCar, and other large corporations. Not sure about Amazon, but with all the other corporate pigs feeding at the trough I would be surprised if they didn't get special tax breaks from the state. I know that got them from the city of Seattle.

I did call and ask for how much B&O tax Boeing paid, but it is confidential information and they would not release it. You might be able to track it down in Boeing's financial statements since they are a public corporation.

The state was really solvent and provided great education and other benefits to the middle class before the corporate tax breaks started with Boeing in the early 1980's. That has been the real change in taxation in Washington state.

My favorite tax break is exempting Boeing airplanes from sales tax. I guess the Sultan of Bruinai can't afford to buy a 747 without the tax break!!

We really do have the "best government money can buy" in Washington!!

[MarciaMarshaMarcia]

Revenue in Washington comes from moving violations, issued from huge numbers of various kinds of law enforcement agencies. And guess what, unlike California, there is no such thing as Traffic School! And, unlike California, where you can pretty much get away with driving backwards and naked down the freeway at 120 mph, in Washington, especially in the rural counties, you can count on getting a ticket just for leaving your driveway.

[Ruth4Truth]

Originally Posted by thisplacesucks

Revenue in Washington comes from moving violations, issued from huge numbers of various kinds of law enforcement agencies. And guess what, unlike California, there is no such thing as Traffic School! And, unlike California, where you can pretty much get away with driving backwards and naked down the freeway at 120 mph, in Washington, especially in the rural counties, you can count on getting a ticket just for leaving your driveway.

CA is onto this, too, as a source of revenue for the state. Fines are much higher now, even parking fines. The State of CA is desperate for revenue, so it's beating the bushes and milking every potential source it can find.

[kanhawk]

Originally Posted by 509

The state was really solvent and provided great education and other benefits to the middle class before the corporate tax breaks started with Boeing in the early 1980's. That has been the real change in taxation in Washington state.

My favorite tax break is exempting Boeing airplanes from sales tax. I guess the Sultan of Bruinai can't afford to buy a 747 without the tax break!!

We really do have the "best government money can buy" in Washington!!

And yet with all that, Boeing still moved it's corporate headquarters to Chicago. Must have been some money changing hands there because Illinois has really been raising taxes in recent years.

[Hemlock140]

Originally Posted by thisplacesucks

Revenue in Washington comes from moving violations, issued from huge numbers of various kinds of law enforcement agencies. And guess what, unlike California, there is no such thing as Traffic School! And, unlike California, where you can pretty much get away with driving backwards and naked down the freeway at 120 mph, in Washington, especially in the rural counties, you can count on getting a ticket just for leaving your driveway.

I wouldn't go quite that far, but despite getting many speeding tickets in CA in my 24 years of driving there, none were for less than 10-12 mph over the limit. At traffic school the CHP officer told me that it was their policy, because there were nowhere near enough of them to enforce speed so they just go for the worst offenders. Here people get stopped for 4-5 over and there are plenty of speed traps. Here in our neighborhood now the radar cop is driving an unmarked dark silver Explorer. Last ticket I got they did remove it from my record because I had not been stopped for so long, but I still had to pay the full amount of the fine.

[Ruth4Truth]

The only speeding tickets I've gotten have been while driving through Indian reservations, and those tickets don't go on the state record.

My town got those radar speed check SUV's a couple of years ago. People HATE them! One guy attacked one that parked on his street at 6 a.m. I can't say they've resulted in decreased accidents. I don't know if that was the point.