SB 5929: Why the Benefits Outweigh the Risks
All over the United States, schools are woefully underfunded and Washington State is no exception: according to The 74, the Education Law Center found that Washington has among the lowest funding in the nation when the size of the state economy is taken into consideration. In general, it’s the high poverty areas – areas with the most need – that are impacted.
Just how much funding is required to meet this shortage isn’t known; it depends on whom you ask. But estimates suggest that between $3.5 billion and $8 billion are needed. And the way to get this is through taxes, including bill SB 5929.
The Washington Senate defines SB 5929 as a bill concerned with, “investing in Washington families by improving the fairness of the state’s excise tax system by narrowing or eliminating tax preferences, imposing a business and occupation tax surcharge while eliminating tax liability for small businesses, enacting an excise tax on capital gains, modifying the real estate excise tax, making administrative changes, and implementing marketplace fairness in Washington.”
This is a bill many realtors are lobbying against and for obvious reasons: it affects their bottom-line. However, this bill isn’t without its supporters, including those involved with selling real estate.
SB 5929 makes sense for several reasons. For one, homeowners pay the bulk in school taxes. There are other reasons, as well. Some of the two most important include:
The increase is minimal for realtors; if this law were to pass, the increase in taxes for a realtor would only be .03% for B&O tax. For the average broker, this increase is extremely negligible. With regards to excise tax, the increase would affect a small number of homes, roughly 4% of sales over $1,000,000. But it would save money, as well: 20% of homes under $200,000 would see a benefit. Most sellers would not be affected at all.
With regards to capital gains tax, which is paid on profits an individual receives from the sale of items like stocks, bonds, and mutual funds, Washington currently doesn’t have one. According to the Seattle Times, a capital gains tax in Washington would only affect around 32,000 people out of 7 million and it would allow for investment of $1.2 billion in basic education and $490 million in higher education.
While some realtors remain against SB 5929, not everyone is convinced that it lacks merit. The above demonstrates that it does indeed maintain benefit while minimizing fallout. This should be enough for us to support it in the name of education.
As a local real estate agent, I can personally see how investment into our community benefits us now and into the future. Kids receive a better education and become the leaders of tomorrow. Schools improve, which in turn helps property values to increase.
A judge has ordered the state to fully fund education. The debate is not IF it should happen, but HOW it should happen and I want to be part of the solution.
Let’s get this done.
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