Washington collects $890M in first year of new capital gains tax
The Washington State Capitol building on Wednesday, Oct. 21, 2020, in Olympia, Wash. (Jovelle Tamayo for Crosscut)
Washington’s new capital gains tax has brought in nearly $900 million in its first year, according to the state Department of Revenue.
The DOR estimates $889 million was collected out of a total of 3,765 returns, according to an agency spokesperson. That number could fluctuate a little before lawmakers return in January for the annual legislative session, according to spokesperson Mikhail Carpenter.
Legislators in the coming session will write supplemental budgets that make adjustments to the state’s two-year spending blueprints.
The first $500 million of the tax is directed toward a state fund that pays for K-12 education and child-care programs. The additional dollars are then expected to go into a state account that pays for school construction.
In March, the Washington Supreme Court upheld the law, which puts a 7% tax on profits from the sale of stocks and bonds exceeding $250,000. Exempt from the tax are sales of real estate, retirement accounts and livestock and timber for ranching or farming. There’s also a special deduction for sales of family-owned businesses. Foes of the tax in August asked the U.S. Supreme Court to weigh in.