Washington state lawmakers are considering levying a 1 percent tax on "extraordinary intangible financial assets" of people whose personal wealth exceeds $1 billion. This includes assets such as cash, futures contracts, and publicly traded options — not income.
Washington Democrats have rallied around the measure as one way to help combat growing economic inequality in the state, which has only intensified during the pandemic.
"The conditions were there before the pandemic, but the pandemic has laid bare the true inequity in our tax code here in Washington state," State Rep. Noel Frame told Cheddar.
The representative said that Washington had the distinction of having the most regressive tax code in the country, with lower-income households paying disproportionately more than higher-income households. The state does not impose a personal income tax.
"I think it's egregious and out of step with our values as a state," she said.
Using confidential data from the IRS, U.S. Federal Reserve, and proprietary information from Forbes, the state estimated that the law would impact 100 taxpayers in Washington.
Among them are world-famous mega billionaires such as Jeff Bezos, Bill Gates, MacKenzie Scott, and Steve Ballmer, who would contribute the lion's share of the tax contributions.
Based on the latest data from Forbes, the Tax Foundation found that about 97 percent would come from those four individuals, though roughly a dozen people would be liable for the tax.
"I have to tell you that number is jaw-dropping to me," Frame said. "I think we know a few of those billionaires in our state, but it turns out there are many, many more."
If passed, the levy would be imposed starting January 1, 2022, for taxes due the following year.
Frame said another goal of the bill is to help fund existing tax credits for lower-income households, including a credit against the sales tax, which she said the state is overly reliant on. She added that about 47 percent of Washington's revenue in 2020 came from the sales tax, which is generally considered more regressive than other taxes.
"When you think about somebody who has a total household income of $24,000 or less, you can imagine how quickly the sales tax on those everyday purchases will add up as a share of your household income," she said.
State lawmakers are set to let the bill "simmer" over the next few weeks, Frame said.
Russian forces escalated their attacks on populated urban areas Tuesday, bombarding the central square in Ukraine’s second-largest city and Kyiv’s main TV tower.
A bipartisan group of 43 representatives joined forces in a letter to President Joe Biden to remind the executive branch that it must seek the approval of Congress before authorizing a war — whether or not its in Ukraine as Russia continues its invasion. Rep. Peter DeFazio (D-Ore. 4th District) led the effort and joined Cheddar News Wrap to explain. "It's time for Congress to get back the authority, which is vested to us in the constitution, not in the executive branch," he said. "The president. once we're at war, we speak with one voice with the commander in chief. But before that, it's up to the American people and Congress whether or not we're going to become engaged in a war."
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As Russia’s attack on Ukraine continues, one of its few big allies remaining appears to be China. Gordon Chang, Asian affairs expert and author of "The Coming Collapse of China," joined Cheddar News to discuss what might be behind China's support for Putin's current strategy. “I think China is looking at what Putin did yesterday, which is to raise his nuclear forces on a higher alert level,” Chang stated, “If they see that Putin gets away with his nuclear threats, which he's been making over the last three or four days, then I'm sure that Beijing is going to ramp up its threats as well, and it could ramp them up against any number of different countries with which it perceives it has a problem with"
Joel Rubin, president of the Washington Strategy Group and former Deputy Assistant Secretary of State, joins Cheddar News to discuss the Russia-Ukraine tensions and the new sanctions President Biden placed on Russia.
