Final budget proposal gets Washington state closer to an inclusive economy

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Final budget proposal gets Washington state closer to an inclusive economy

Statement from the Washington State Budget & Policy Center

April 24, 2021

The state budget is supposed to be a reflection of our values. For years, advocates and community members alike have called on lawmakers to enact a budget that corrects longstanding inequities and enables people to live with dignity. And the need for a more equitable and robust budget grew even more with the economic fallout of COVID-19. So it is good news that the final budget proposal by House and Senate Democrats gets our state closer to a more just and inclusive economy. This is thanks to the hard work and organizing of partner organizations and communities across the state.

Here are three progressive wins for our state economy (and Budget & Policy Center priorities) that we applaud:

1. Investments in cash assistance through WorkFirst/Temporary Assistance for Needy Families (TANF) and the Washington Immigrant Relief Fund:

Communities have long known how powerful direct, flexible cash support can be. The 15% increase in monthly cash grants will enable families experiencing deep poverty to better afford the basics. The budget also funds some changes to TANF time limit extensions to help prevent families from having their benefits eliminated as a result of punitive time limits built into the current law. And the $340 million investment to continue the Washington Immigrant Relief Fund will help more people be a part of the state’s recovery – regardless of immigration status.

2. A more equitable tax code through a Recovery Rebate, or updated Working Families Tax Credit:

This targeted tax credit will help rebalance our tax code and further expand direct cash support to communities. The Working Families Tax Credit will provide a base cash rebate of $300 to $1,200 to 420,000 households across the state. Washington also joins five other states to include Individual Tax Identification (ITIN) filers, a group of taxpayers which includes some student visa holders, survivors of domestic violence, and undocumented immigrants. Including ITIN filers will help even more people across the state afford basics like food, medicine, or transportation.

3. Progressive revenue with a tax on extraordinary profits:

A capital gains wealth tax, which is assumed in the final budget proposal, will raise more than $400 million per year in new revenue to expand critical investments in schools, child care and early learning, and financial aid for students attending community colleges, technical colleges, and four-year colleges and universities. Along with the working Families Tax credit, this equitable reform will help rebalance our racist, worst-in-the-nation tax code by ensuring the wealthiest in our state finally pay their share.

These policy wins and many others like funding for the Healthy Environments for All (HEAL) Act, Fair Start for Kids Act, and police reform measures come after so many people speaking out for the need for progressive change.  Together, these budget items will set the stage for a more inclusive economy where everyone can meet their needs and thrive.

It will take more than a single legislative session to undo generations of harm caused by budget and policy decisions that created inequities in the first place (especially for Black, Indigenous, and POC communities), but the final budget proposal released by House and Senate Democrats puts our state on the path toward a more equitable future.