How does free school lunch for everyone sound? Well, that’s just one policy that Washington’s new millionaires tax is likely to fund.
On March 30th, 2026, Governor Bob Ferguson signed into law the ‘Millionaires Tax’—a 9.9% income tax on households with an income of over one million dollars. This tax would take effect in 2029 and bring in $3 billion a year from approximately 21,000 filers.
The primary goal of this tax is to shift the tax burden off of lower income earners.
Senate Majority Leader Jamie Pedersen said, “We’ve asked Washington’s working families for far too long to shoulder far too much of the tax burden for the things that we all care about. We have not asked enough of our wealthiest neighbors.”
According to the Institute on Taxation and Economic Policy, Washington’s has the 2nd most regressive tax code in the U.S.—only second to Florida. This means that people who make less money pay disproportionately more money in taxes than those who make more money.
“We’re going to begin to right a historic wrong that has plagued our state for nearly 100 years and made our tax system one of the worst and most regressive in the entire country,” Pedersen said. “I hope and believe that one day we’re going to look back on this day as the day when things really started to change for us, when our state and our system started to get more fair.”
According to the Institute, “When the lowest-income households pay the greatest proportion of their income in state and local taxes, gaps between the most affluent and everyone else grow larger.”
Until the signing of this bill, Washington was one of 9 states that did not tax individual wage and salary income.
The money generated from the tax will be used to fund several things. A large portion of the money will be used to make a large expansion of the Working Families Tax Credit. In addition to this, 5% of the income generated is designated to go to the Fair Start For Early Kids Act (financial support for child care and early learning programs), companies grossing less than $300,000 will be exempt from paying the state’s main business tax, and sales for tax for items such as diapers, personal care products, and and over the counter drug products will be eliminated.
Additionally, democrats have introduced many non-binding ideas for future legislation such as free school lunches for public school students.
The income tax has faced significant pushback among Republicans while the only Democratic opposition is focused on how exactly the funds should be used.
There are several organizations that are strongly opposed to the new tax and lawsuits are imminent.
Senate Minority Leader John Braun, said in a statement, “Today is a dark day in our state’s history. Republicans have said all along that an income tax on anyone in our state will become an income tax on everyone.”
Freshman Michael London says the tax is unconstitutional because of double taxation.
“I personally think it is stupid,” Michael said.
Brittany Lords has a more positive view of the new tax, “Honestly, I think a millionaires tax woud be very benefical to the middle and working class due to the difference in wealth. Plus, Bob Furguson stated that he would use the money gained from these taxes towards Washington schools and learning programs. In general, I think it is unfair that the top 2% is being taxed the same, and in some cases, less than the working and middle class. To put it shortly, I think this tax is good for us .”
