Call to Action! Last Push For This Session

This is the final all member Call to Action launched on the Capital Gains Tax. Please take a few moments and ask your State Legislator to oppose a Capitol Gains Income Tax and help us promote the CTA. It's quick, easy to do, and we need one last big push to defeat this idea this legislative session!

As the Legislature nears the July 1 deadline for adopting a new state Operating Budget, REALTORS® urge lawmakers to reject a new tax on income from capital gains that includes increased taxation of real estate transactions and the sales of small businesses.

To date, public information about this tax proposal has been inaccurate, such as the Seattle Times recent description of it as a tax on income from "profits generated by very large investment portfolios, above and beyond retirement accounts." For many in Washington State, real estate investments are a person's retirement account, and the sale of real estate is already taxed at one of the highest rates in the entire nation. While many states impose a capital gains tax, these states have much lower real estate transfer taxes, or apply real estate transfer taxes to only the amount of the gain in the sale, not to the entire purchase price like Washington State. Other states that tax income from capital gains, like Oregon, have no real estate transfer taxes at all.

In addition, unlike the "large investment portfolios" of Washington's wealthiest citizens, investments in real estate and small business have been generating tax revenues for state and local government each and every year. The mere ownership of real estate generates property tax, and commercial real estate is the home of small businesses that generate significant amounts of B&O and sales tax. In contrast, the ownership and sale of stocks and other financial investments generate no tax revenue for Washington State. In Washington State, income from capital gains in real estate will occur most often in Seattle and King County the part of our state where housing affordability for both buyers and renters is at an all-time low. This additional tax on real estate income will simply add to the housing affordability problem in King County.

REALTORS® agree with some of the points raised in the State Legislature concerning the regressive nature of our state's tax code and this is because we already tax both real estate and real estate businesses at one of the highest rates in the country. Adding a new capital gains income tax on real estate will only further the negative impacts of our state's code on real estate, small business, and housing affordability.


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