Wash. leaders split on sales tax hike for budget - Spokane, North Idaho News & Weather KHQ.com

Wash. leaders split on sales tax hike for budget

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OLYMPIA, Wash. - State leaders are split over the idea of a sales tax increase to help balance Washington's $2.8 billion budget deficit.
     
Senate Democrats want to raise the sales tax three-tenths of a penny. But Democratic Gov. Chris Gregoire doesn't like that approach. And House Democrats still haven't settled on a tax package.
     
Legislative leaders are revealing their dueling budget-balancing plans Tuesday in Olympia.
     
The House version would cut less from state spending, and seek fewer tax hikes than the Senate version. Instead, House Democrats want to rely more heavily on one-time fund transfers and federal money.
     
The Senate's budget plan calls for specific tax hikes, including the temporary sales tax increase and more than $500 million in closed tax exemptions.

Washington Senate Democrats want sales tax hike

Democrats in the state Senate want to temporarily raise the sales tax by three-tenths of a penny, slap another dollar of tax on a pack of cigarettes, and close a long list of tax exemptions to balance the state budget.
     
It's the first of two legislative budget-balancing proposals being revealed Tuesday in Olympia.
     
Overall, the Senate's majority Democrats say they would raise about $918 million in revenue to help patch the $2.8 billion budget deficit.
     
They also would cut about $840 million from spending. Fund transfers, federal money, and other one-time fixes would also be used.

Wash. Legislature OKS suspension of I-960

The Washington state Legislature has passed a temporary suspension of Initiative 960, just ahead of House and Senate Democrats unveiling their budget proposals.
     
The Senate passed the measure on a 26-21 vote Monday night. It now goes to Gov. Chris Gregoire for her signature. I-960 makes it harder for legislators to raise taxes, which is why the Democratic majority needs it to be suspended.
     
Budget writers want a mix of spending cuts, tax increases and one-time fixes to fill a $2.8 billion deficit. But Initiative 960, approved in 2007, requires two-thirds approval from legislators to
raise taxes, a significant hurdle compared with the simple majority needed to pass other measures.

More Information:

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State-by-State ranking of cigarette excise tax

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