EKCC 2022 Budget & Taxes Position Paper

The Coalition thanks the Legislature for passing B&O tax deductions for PPP and EIDL, Tax Increment Financing, and other actions which aided the recovery of locally owned businesses during the pandemic and allowed them to remain competitive.

However, more must be done, and we ask you to sincerely consider our recommendations on tax policy:

Work to Fund State General Government Operations with Only Existing Revenue Sources

During the pandemic, local businesses were forced to make hard choices and reduce wages, lay-off employees, cut
costs wherever possible, and defer plans to survive. Now that recovery is in sight, we ask the Legislature to
recognize that increasing burdens on businesses will be harmful to economic resurgence.

Guarantee the Ongoing Health of the Unemployment Insurance Trust Fund

• Stabilize Unemployment Insurance rates subsequent to the current four-year budget horizon.
• Keep the solvency tax removed until 2025.
• Keep reduced and flattened socialization taxes through 2025.
• As needed, transfer from the General Fund to maintain trust fund balance.
• Do not hold businesses accountable for fraudulent payments beyond their control.

Delay Implementation of the Long-Term Care Act

• Extend exemption filing date for those seeking private options, as well as the premium collection date, for
at least six months.
• Reconsider the actuarial basis to verify that projected payout levels, can be met at current premium rates.
• Provide full vesting for those who fall short of 10 years in the initial implementation period, due to
mandatory retirement.
• Exempt employees over age 70 from mandatory participation, as they will be unlikely to receive benefits.

Resist Raising Taxes to Fund General Government Operations
The Washington state operating budget is in its best position in many years after an influx of federal funding and
other support. With exception to a gas tax, higher taxes or new taxes, especially an income tax, sales tax, excise
tax, B&O tax, will be another barrier to survival and a threat to economic recovery.

Provide Assistance to Small Businesses
• Incentivize small businesses to acquire and retain new or former employees while cash flow is tight by
enacting a B&O tax credit for new hires.
• Adopt HB 1299, providing a B&O tax exemption through 2025 to businesses engaged in retail, hospitality,
and amend to include fitness related business activities and performance venues.
• State agencies should digitize all correspondence with claimants and businesses. Conducting all L&I
business electronically will greatly reduce costs, carbon footprint, and claim request times, and allow for
quicker reactions to fraudulent claims.
• Move L&I rates back to pre-covid levels.