One of the provisions that cities support in the revenue proposals HB 2186 and SB 5929 is a state version of a long-standing AWC priority, the Marketplace Fairness Act. To see projections for your city if the proposal passes, visit the data view here, and click the arrow to choose your city from the list.
Updating sales tax collections to reflect the growing reliance on internet sales makes sense in Washington, where sales tax accounts for almost 50 percent of state revenues in the operating budget.
Cities support these changes to help level the playing field between local brick and mortar businesses and out-of-state internet retailers in sales tax collections.
AWC does not support the proposal in the House budget to end Streamlined Sales Tax mitigation beginning in 2019 to cities impacted by the change to destination-based sourcing. The state should continue to provide mitigation to impacted jurisdictions.
In addition, AWC has continued to express support for new proposed revenues that include a local government share and promote local economic security, such as repeal of the tax exemption on bottled water and support for a graduated rate for the state Real Estate Excise Tax (REET).
The proposal to establish a graduated rate for the state REET would result in a lower 0.75 percent rate on residential sales under $250,000, the same 1.28 percent rate on sales $250,000 to $1 million, higher rates of 2 percent for sales $1 million to $5 million, and 2.5 percent for sales over $5 million. AWC also requests similar authority for cities as a local option.