How we raise money to fund the public good impacts all of us, from kids to retirees. Reforming Washington’s tax system is an issue that’s close to our hearts, and one that EOI has advocated for and organized around for years. Protecting progressive revenue options is critical to making the ultra-wealthy pay what they owe to our communities.  

This June, EOI went on a road trip to Eastern Washington to connect with advocates. We asked about the biggest issues facing communities. Consistently, we heard about the struggle to access childcare and concerns about cuts to public schools. We heard stories of families trying to cope with working long hours or more than one job to make ends meet, while making sure their kids are safe when they can’t be at home. 

So many families across the state share the same economic reality, and they can’t afford the passage of I-2109, a conservative-backed proposal on the ballot this November. I-2109 would slash billions in funding for education and early learning just to give a tax cut to the wealthiest 0.02% in our state. 

As more families are forced to do “survival math” (such as choosing between filling prescriptions or buying groceries), the rich in Washington are getting richer. The Seattle Times recently reported that Seattle is home to over 54,000 millionaires, 130 “centimillionaires” with over $100 million in wealth, and 11 billionaires. While working people are pushed to the margins, the rich amass more wealth – not by working 12-hour shifts and shopping at Grocery Outlet, but by investing their wealth in Wall Street, with stocks and bonds that grow money for them while they sleep.   

This picture of stark inequality shows us the real stakes for I-2109, the right-wing effort to repeal the capital gains tax. Repealing the tax on capital gains means cutting billions of dollars in funding for Washington’s kids, just so multi-millionaires can have more money. If passed, I-2109 would cut more than $5 billion from education over the next 6 years. It is imperative that we soundly defeat this measure by voting NO on I-2109.  

What is the capital gains tax?  

The capital gains tax is a modest tax on excessive profits from selling financial assets. To pay the tax, an individual must profit over $250,000 in a single year from the sale of assets such as stocks and bonds. Only profits above $250,000 are taxed.  

The assets that regular people have as their nest egg, like IRAs, small family businesses, farms, and all real estate, are exempt. For example, if someone were lucky enough to profit $1 million from the sale of the family farm, they would not pay the capital gains tax.  

Even with these important guardrails, there is still such great wealth in Washington that in its first year alone (2022), the capital gains tax raised an incredible $889 million for education.  

Who’s paying into the tax?  

Around 4,500 Washingtonians qualified to pay the tax in its first few years of implementation. 84% of the revenue raised from this tax comes from wealthy residents in King County, in places like Seattle, Bellevue, and Medina. Only a small fraction of Seattle’s 54,000 millionaires are rich enough to pay the tax.  

Where does the money go?  

Revenue from the capital gains tax is dedicated to public school and early learning programs. Each year, the first $500 million raised is allocated for public education, with the remaining going toward school construction projects. 

Fully funding education and childcare is integral to Washington families’ quality of life and our state economy. From Sunnyside to Seattle, parents and businesses are desperate for more local childcare services. Public schools, from Marysville to Spokane to even wealthy Seattle, are facing budget shortfalls, meaning they must layoff key staff, deal with crumbling facilities, or even choose to close schools altogether.  

The capital gains tax provides critical funding to support Washington’s kids by asking the very wealthiest in our state to pay their share. If I-2109 passes, the responsibility to fund these programs will be shifted back to middle and low-income taxpayers, who already pay more in state and local taxes than the rich. 

This fall we have a choice: hand the ultra-rich a tax break they don’t need or preserve funding for Washington’s youth. We think it’s a no-brainer.  

Protect our kids, protect capital gains and vote NO on I-2109.  

Get involved by spreading the word and joining the campaign.