At 10.4% Lynnwood has the highest sales tax in Washington state, and we are taxed at the highest possible amount on our utilities. These taxes are known to be extremely regressive, which is to say that they impact the lowest income earners the most. To understand why consider two new mothers, Mom A makes $1200 per month, and Mom B makes $5,000 per month. Both will need bottles, diapers, clothes, furniture, and more. Say all of these cost $5,000 before tax over the course of the first year, that means, in Lynnwood, each mom will pay $520 in sales tax per year. For Mom B that is a negligible part of her income, but for Mom A it’s significant. Of course these figures don’t take into account all of the other essential items all people need to purchase, but it does demonstrate the disparity in burden.
Lynnwood needs to lower these taxes, unquestionably, and I will work towards that end. The complicating factor is that Lynnwood, a rapidly growing city, also needs to raise even more revenue than it does currently. So while lowering these regressive taxes is important, instituting progressive taxes is just as essential.
Lynnwood currently does not impose a local business and operating tax. I believe that we should maintain that for small businesses, and we need to do some research to see how to qualify as a small business. For larger businesses and corporations we need to see a greater degree of revenue. It is true that this will raise the cost of doing business in Lynnwood, but the fact of the matter is that it is getting more expensive to live in Lynnwood, so we all need to do our part to keep our city an excellent place to live. If we want to ensure that we keep our roads and pathways maintained, provide necessary social services, build new parks, and invest in our small businesses, without putting the burden on the backs of our residents with the least amount of money, these are the kind of taxes we ought to be considering.
A local, and conditional, B&O tax won’t solve all of our problems, but it’s part of a larger conversation on progressive taxation that we need to have. I’m looking forward to exploring all of our options as your city council representative.