Overall Tax Competitiveness (Tax Foundation 2026):
- Rank: 45th (out of 50) — 6th worst overall
- Sales Taxes: 49th — 3rd highest combined state/local rate in the nation at 9.57%
- Corporate Taxes: 47th
- Individual Income Taxes: 31st — currently no broad income tax, but the 9.9% tax on retirement accounts, as well as income over $1 million (which is only a starting point) starts January 2028. *There is talk already of losing the income limit to include everybody on a scale while still keeping the 49th highest sales tax.
- Property Taxes: 25th
But the bigger story is what the state is losing:
- Howard Schultz, Starbucks founder, is leaving for Florida after 44 years, announced right as the income tax passed
- Jesse Proudman, Venice.ai founder, is leaving after starting three companies here, calling the state increasingly hostile to job creators
- Starbucks expanding in Tennessee could cost Seattle up to $750 million in tax revenue
- 17% of Washington employers are considering relocating, up from 9% last year
Meanwhile, the politicians' response:
- Sen. Jamie Pedersen, the tax's author, dismissed exodus concerns as businesses are literally leaving
- Seattle Mayor Katie Wilson laughed about millionaires leaving, saying "bye"
Bottom line: Washington's average tax burden looks middling as a percentage only because the state's incomes are high — the sales-tax reliance ranks 4th worst in the nation for how much of your paycheck it eats. Adding a 9.9% income tax won't fix that; it just pushes out the employers everyone else depends on. YES on I-645 repeals it before it starts.
Thoughts comment below.