The Washington Policy Center and Buckeye Institute recently released a report showing, among other findings, 18,000 fewer jobs in Washington state if the state’s new income tax is allowed to remain, according to a news release from the National Federation of Independent Business (NFIB).
“This report details the significant job and economic losses small business owners have warned are coming as a result of the new state income tax,” Patrick Connor, state director for NFIB in Washington, said in the news release. “That’s why small business owners overwhelmingly support the Yes on I-645 campaign.”
According to the news release from NFIB, if the tax remains, there will be:
• Nearly 8,000 fewer jobs just in 2028
• 6,100 fewer jobs and 1,400 fewer new businesses annually
• Washington would produce almost $5 billion less in goods and services in 2028, growing to a loss of $8.3 billion by 2036
• Consumer spending would drop by $3.6 billion in 2028, and business investment would be $3.1 billion less that year
During the legislative session, 98% of NFIB member small-business owners polled were opposed to the bill creating the income tax, also known as the “millionaires tax,” according to the release. The new $4 billion yearly income tax was passed in addition to a $9.5 billion suite of tax increases on businesses the Legislature approved in 2025.
While often called the millionaires tax because, as currently written, it levies a 9.9% on those making over $1 million, the law doesn’t prevent future Legislatures from dropping it to lower income brackets. Some Democrats have vocally expressed a desire to lower the threshold to $250,000. Gov. Bob Ferguson said he would veto any attempt to do so.
Small business owners from across the state shared their concerns about the impact of the new tax on their ability to provide raises and enhance benefits for employees, purchase new equipment, expand operations, add jobs and remain competitive with businesses in other states, and some are considering moving their operations out of state, the news release stated.
