After ninety-three years and a twenty-five-hour filibuster, Washington finally has an income tax—and billionaires are now packing their bags

In a historic move, Washington State lawmakers have passed the first-ever personal income tax in the state’s history, imposing a 9.9% tax on income over $1 million. The tax, which aims to address Washington’s regressive tax structure and growing budget deficit, was passed after 25 hours of intense debate and multiple attempts by Republicans to block the bill.

A Historic Victory for Washington’s Tax System

The tax, approved on March 9, 2026, is set to affect less than 1% of Washington’s population, approximately 21,000 filers. The bill, which passed by a narrow 52–46 vote, marks the first time in Washington’s history that lawmakers have enacted an income tax.

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For Rep. Brianna Thomas, a Democrat who supported the measure, the victory represents a critical shift in how the state addresses its tax policies.

“We knew it was going to be a pretty major endeavor,” Thomas said, referring to the challenge of passing the bill after 93 years of precedent against an income tax.

Washington had previously voted on an income tax in 1932, but the state Supreme Court struck it down a year later. The state has remained one of only nine without an income tax.

A Tax System Designed for a Modern Economy

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Washington’s economy has changed significantly since it was built on agriculture, timber, and shipping in the early 20th century. With major global corporations like Amazon, Microsoft, and Boeing calling the state home, Washington’s tax system, reliant on sales taxes and business taxes, has increasingly been criticized as outdated and regressive.

According to the Institute on Taxation and Economic Policy, Washington’s tax structure has been ranked among the most regressive in the nation, with the top 1% of earners paying just 4.1% of their income in taxes, while the bottom 20% pay 13.8%.

Thomas argues that the new millionaire’s tax aims to address these disparities by requiring the wealthiest residents to pay a fairer share.

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“We’ve got more millionaires and billionaires than we’ve ever had, and they’re paying, effectively, a 4% tax rate,” Thomas said. “Meanwhile, you got working folks paying 11% of their income. Isn’t it unfair for those who have the most to pay the least, and those who have the least to pay the most?”

Tax Relief for the Rest

In addition to imposing the new millionaire’s tax, the bill includes tax relief for other residents. The new legislation offers sales tax exemptions for essential items like diapers, over-the-counter medications, and personal hygiene products.

Additionally, the Working Families Tax Credit will be expanded to benefit lower-income families.

The 9.9% tax is expected to generate $3.5 to $4 billion per year, beginning in 2029, which will help address the state’s projected budget deficit of $10 to $12 billion over the next four years.

A Long and Contentious Debate

The path to passing the bill was far from smooth. The House debate lasted a record-breaking 25 hours, with 81 amendments introduced by Republicans attempting to stall or block the measure. In the end, the Senate concurred with the House vote, passing the bill 27–21, avoiding a similarly lengthy debate.

Despite the contentious debate, the bill was hailed as a significant step toward modernizing Washington’s tax code. Gov. Bob Ferguson has indicated he will sign the bill into law.

Challenges Ahead

However, the bill still faces several hurdles before it can become law. Rep. Brianna Thomas was careful to temper expectations, noting that the law will need to undergo Supreme Court review and will ultimately be subject to a vote of the people.

“We’ve got to let it sit,” Thomas said. “There are many miles to go before this is actually the law of the land.”

Broader National Implications

Washington’s millionaire’s tax is part of a broader national push to tax extreme wealth. Recently, Sen. Bernie Sanders (I-Vt.) and Rep. Ro Khanna (D-Calif.) introduced the “Make Billionaires Pay Their Fair Share Act,” which proposes a 5% annual wealth tax on Americans with a net worth above $1 billion.

The bill is designed to target the richest Americans, with revenue from the tax intended to fund programs like Medicaid, teacher salaries, and childcare costs.

Similarly, California has proposed a Billionaire Tax that would impose a one-time 5% tax on residents with a net worth above $1 billion, potentially generating $100 billion in revenue for healthcare and food assistance.

Reactions from Washington’s Wealthy

The millionaire’s tax has already prompted reactions from the state’s wealthiest residents. Howard Schultz, the founder of Starbucks, announced that he would be leaving Seattle for Miami, citing concerns over the state’s new tax policies.

Similarly, Amazon founder Jeff Bezos moved to Miami in 2023, costing Washington an estimated $954 million in tax revenue for 2024 alone.

Despite these high-profile exits, Rep. Brianna Thomas remains undeterred. “I certainly hope Washington is more than a spreadsheet or a tally sheet to someone,” she said. “This isn’t a math problem to me. This is a policy problem rooted in the fact that I care about my community.”

Washington’s passage of the millionaires tax represents a historic moment in the state’s tax history, challenging the longstanding reliance on regressive sales taxes and providing a new avenue for addressing budget shortfalls.

While the measure still faces legal and public hurdles, it signals a growing momentum in the U.S. to hold the wealthy accountable for contributing more equitably to the economic system.

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