State Supreme Court upholds B&O tax on large banks in Washington
Sep 30, 2021, 1:52 PM | Updated: Oct 1, 2021, 6:39 am
A Wells Fargo location in downtown Seattle. ()
()
The Supreme Court of Washington State on Thursday, ruling that a B&O tax on banks doing business in Washington state is indeed constitutional.
Washington state lawmakers push to suspend Boeing tax breaks
The tax was passed by the state Legislature in 2019, enacting an additional 1.2% B&O levy on financial institutions worth at least $1 billion.
The Washington Bankers Association and the American Bankers Association filed a lawsuit over the tax later that year, claiming that it violated the U.S. Constitution’s Commerce Clause by only targeting out-of-state institutions, and giving banks in Washington an unfair advantage. The groups’ initial filing also alleged that the measure violated the Washington State Constitution due to its initial status as a “title-only” bill.
鈥淭itle-only鈥� bills basically function like a legislative IOU 鈥� lawmakers first introduce a bill with a title and no text, and then amend it to add the actual provisions later on. In the case of this tax, the bill’s substantive policies weren’t fleshed out until the final two days of the legislative session. The WBA and ABA claimed that violated a clause in the state Constitution requiring bills be introduced at least 10 days before the session ends.
That claim was thrown out in a lower court, with the state Supreme Court subsequently stating that “this case is not the proper venue to collaterally attack or relitigate a dismissed issue.” Regardless, justices did also note that plaintiffs “offered little argument and no case law or persuasive authorities in support” of their argument pertaining to “title-only” bills.
State lawmaker: Capital gains tax 鈥榥ot necessarily鈥� the first step toward income tax
The state Supreme Court voted 8-1 against the banking groups’ other claims, pointing out that the B&O tax “applies equally to all financial institutions meeting the $1 billion income threshold, irrespective of whether they are based inside or outside of Washington.”
State Attorney General Bob Ferguson on Thursday, saying that it “correctly applies the law and is a win for those fighting to make Washington’s tax system fairer.”
“I’m proud of my team’s work to uphold Washington’s new progressive tax on the tremendously most profitable large banks operating in Washington,” he added.
成人X站 Radio reporter Hanna Scott contributed to this story.
