WA small businesses push back on tax proposals

Washington's small businesses brace for historic tax increases

Small businesses across Washington are bracing for potential tax increases as state lawmakers address a $13 billion budget shortfall. Fox 13’s Shirah Matsuzawa reports on a virtual briefing where business leaders voiced concerns about the impact on economic stability.

SEATTLE - Small businesses across Washington are bracing themselves right now for proposed taxes.

On Thursday, the Seattle Metropolitan Chamber of Commerce, along with the Association of Washington Business, the Washington Roundtable and Bellevue Chamber of Commerce gathered online to talk about the potential impacts.

Those organizations are working together because they say they’re urging lawmakers to address the projected $13 billion state budget shortfall without raising taxes on businesses, especially small and mid-size businesses, which they say are the lifeblood of our economy.

Business reaction to proposed taxes

What they're saying:

"I really worry about the proposed taxes in the Washington House and Senate budgets, for a small business it sometimes feels like a death by a thousand cuts," Amelia Cook, Goodwinds Composites owner said.

She said on the call that businesses like hers have already felt the impacts of taxes and inflation, and she’s concerned about what’s to come. "A business can grow revenue to cover costs only two ways, it can raise prices which we’ve done, or we can get new customers, raising prices only goes so far," Cook said.

"If approved, the revenue proposals being considered at the state level would result in the largest tax increases in [the] state's history," Rachel Smith, President and CEO of Seattle Metro Chamber said.

"Over the past decade the state operating budget has more than doubled, with a 37% increase in just the last four years, far exceeding increases in state population, inflation and state income, threatening our economic stability," said Steve Mullin, President at Washington Roundtable.

CEO of Ascend Hospitality Group, Elaina Morris shared on Thursday’s call that since 2020, she’s closed six restaurants in Washington.

"The fact is continually rising city and state minimum wage and ever-increasing real estate taxes are overburdened my businesses, these perpetual increases, along with these now proposed tax hikes could truly be the nail in the coffin for many small and midsize businesses," Morris said.

The other side:

Thursday’s call comes after the four organizations sent a letter to Gov. Bob Ferguson, along with Washington senators and representatives asking them to review and revise the recent tax and budget proposals. More than 60 Washington executives signed their names on it, including the CEO and President of T-Mobile, Puget Sound Energy and Nordstrom.

Their pleas come as there is a lot of uncertainty happening at the federal level. Something Cook has also been hit with, as her Canadian customers have paused their orders in anticipation of tariffs. "That means less revenue for my business," Cook said.

President and CEO of the Bellevue Chamber of Commerce, Joe Fain, said Washington already has the highest business failure rate in the nation, and these proposed taxes would only exacerbate that.

"We need lawmakers to be champions for the economy, not champions for the largest tax increase in state history," Kris Johnson, President and CEO of the Association of Washington Business said.

The Source: Information in this story comes from original reporting from FOX 13 Seattle reporter Shirah Matsuzawa.