Washington State Rolls Back Estate Tax Rates

0:00It's March 25th. This is Vancouver News today, driven by AI. Washington State is rolling back its estate tax rates, ending its spot as having the highest in the nation. Governor Bob Ferguson signed a bill Tuesday that restores the top rate to 20 percent on the states over about $9 million after a $3 million exclusion. The change takes effect July 1st. Last year, Ferguson and Democratic lawmakers raised that top rate to 35 percent as part of tax hikes to fix a multi-billion dollar budget gap. The increase started July 1st of this year, but sparked worries about wealthy residents leaving the state. Supporters of the rollback said the big jump could push people and family businesses to flee, hurting the economy. Opponents argued there's no proof of that, and cutting the tax would mean less money for schools and colleges, which get most estate tax dollars. The bill passed easily in the final hours of the legislative session, with the House voting 85 to 8 and the Senate 35 to 10.

1:02Most no votes came from Democrats, and Ferguson called it a needed adjustment to avoid being an outlier. Reversing the hike means the state could collect around $41 million less, this budget cycle, and over $340 million less. Next time, though some Democrats say those losses are overstated, this leaves questions about how Washington will balance its books moving forward.