I-1107 Would Repeal Common and Reasonable Taxes

Initiative 1107, a citizen initiative slated to appear on the November 2010 ballot, would repeal the following recent tax increases on nonessential items:

• A temporary extension of the state sales tax to bottled water.
• A permanent extension of the sales tax to purchases of candy and gum.
• A temporary excise tax on soda of two-cents per 12 ounces.

It is important to note that these types of taxes are quite common throughout the United States.  The map below shows that Washington is one of 31 states that apply the state sales tax to purchases of candy. Among these states, 14 also apply the tax to bottled water.  (Five states do not levy a general sales tax.)

In addition to Washington, six other states — Arkansas, Illinois, Rhode Island, Tennessee, Virginia, and West Virginia — levy selective taxes on soft drinks or soda.

The tax increases that would be repealed under I-1107 are part of a larger package of revenue enhancements that was enacted earlier this year.  Without these enhancements, policymakers would have been forced to make unacceptably deep cuts in fundamental public services like health care and education.   By eliminating the taxes listed above (in addition to reopening two wasteful B&O tax loopholes), I-1107 would cost the state some $250-$300 million over the next three years.

For more information on I-1107, read the Budget & Policy Center’s latest policy brief, “2010 Initiatives Could Impact Public Services.”