Olympia City Council rejects State Initiative 2109

To protect critical funding for schools, early learning, and child care, the Olympia City Council passed a resolution yesterday opposing Initiative 2109, a state ballot measure that would repeal Washington State's capital gains tax.  

Enacted in 2021, the capital gains tax applies a 7% rate on the sale or exchange of certain long-term assets, such as stocks and bonds, for individuals with annual capital gains over $250,000.  

The capital gains tax applies to only some capital assets held for longer than a year, such as stocks, bonds, precious metals, or artwork.  

On Tuesday, at the city council meeting Assistant City Manager Debbie Sullivan explained that the revenue generated from the tax is earmarked for education and early learning programs. She added that the first $500 million goes to the state's education legacy trust account, which supports K-12 education, expands access to higher education, and provides funding for early learning and childcare programs.  

Any amounts collected above $500 million are applied to the common school construction account, which funds the construction of facilities for common schools.  

If approved by voters, Sullivan said the Washington State would no longer impose taxes on the sale for exchange of long-term capital assets. "This would eliminate the funding collected from the tax that currently goes to education, early learning, childcare programs, and school construction." 

Read the full story in The JOLT