SOURCE: Washington Technology Industry Association

Washington Technology Industry Association

September 30, 2010 11:00 ET

WTIA Announces Opposition to Washington State Income Tax Initiative 1098

Statewide Technology Association Cites Concerns Regarding Business Impact, Legality and Accountability in the Use of Funds

SEATTLE, WA--(Marketwire - September 30, 2010) -  The Washington Technology Industry Association (WTIA) (http://www.washingtontechnology.org), one of the largest statewide associations of technology companies, IT departments and individual technology professionals in North America, today announced its opposition to Initiative 1098, the Washington State ballot measure that would, among other things, impose an income tax on higher wage earners beginning in 2012. Noting that a majority of its members oppose the measure, the WTIA board expressed concern about the impact that such a tax would have on the ability of businesses in the state to attract and retain top talent and investment, the lack of definitive guidelines and accountability to ensure that proceeds from the tax would be used to improve education and healthcare, as well as uncertainty over the measure's legality.

The major provisions of I-1098 include a five percent tax on income above $200,000 for individuals and $400,000 for married couples and domestic partners who file their taxes jointly, a nine percent tax (plus $15,000) on individual income above $500,000 and a nine percent tax (plus $30,000) for couples making more than $1,000,000. The measure also promises to reduce property taxes for all property owners and provides for larger tax credits for small businesses. Revenues from the tax would be placed in a new trust fund, 70 percent of which would go to the education legacy trust while the remaining 30 percent would be used for the state's basic health plan, care for the elderly and disabled and local public health programs.

"While we respect the opinions of both sides, a significant majority of our members are not in favor of this particular initiative which is why we have chosen to take this position as an organization," said Susan Sigl, president and CEO of the WTIA. "The absence of a state income tax gives Washington companies a competitive advantage in their efforts to recruit and retain the best and brightest from across the country. In addition to potentially diminishing this advantage, the measure raises the concern that funds may not be used to finance education and health programs as the measure's supporters intend."

In an August survey, 62 percent of the WTIA's members said they "definitely" would not support the measure and an additional 11 percent said they would "probably" not support it. Just 23 percent combined said they would definitely or probably support it. Respondents expressed a concern that the targeted tax embodied in I-1098 would be a precursor to a more broadly applied income tax in the future.

"At a time when our state continues to struggle with high unemployment, the one bright spot is the technology sector," said Steve Wood, chairman of the WTIA Board. "The latest Washington State economic update specifically highlighted the fact that our software companies have added over 900 jobs this year. WTIA member companies tell us that they believe I-1098 will have a negative impact on their ability to accelerate job growth."

The WTIA also expressed concern that questions about the constitutionality of the income tax under Washington law would lead to prolonged litigation until well after the tax is scheduled to go into effect. This would create additional uncertainty for businesses and individuals.

About the Washington Technology Industry Association
The Washington Technology Industry Association, founded in 1984, is one of the largest statewide associations of technology companies, IT departments and individual technology professionals in North America. With more than 1,000 members representing more than 125,000 employees in Washington State, the association is a catalyst for sharing expertise, fostering collaboration, delivering key business services and advancing the value and global impact of technology companies doing business in Washington. The association's global partners are Microsoft, Regence BlueShield, Vertafore and Wells Fargo Insurance Services. The association's funding partners are AH&T Insurance, F5 Networks, Moss Adams LLP and RealNetworks. For more information, go to www.washingtontechnology.org.

Contact Information

  • Media Contacts:
    Rob Wachter
    WTIA
    206-448-3033 x103
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    Chris Warfield
    Sterling Communications for WTIA
    206-388-5758
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