OKANOGAN COUNTY – Democrats in the State Legislature and Executive branch have added another new payroll tax for all workers in Washington state, starting on January 1st, 2022. They have also raised the rate, by 50%, of another payroll tax that was imposed last year. In coming years, it is expected that there will be further steep tax increases for these taxes that come out of every worker’s paychecks, because the entitlement programs that they fund are not actuarially realistic with their projections.
The new payroll tax, called “WA Cares Fund”, will take an additional $20 a month out of a $20/hr worker’s paycheck to pay for a long term care program. Then, the total increased tax for the Paid Family and Medical Leave (PFML) tax will also take an additional $21 a month out of those same paychecks.
The new “WA Cares Fund” tax will have many workers paying into the program who will be ineligible to receive any benefits from it. Between the unfair treatment and the poor coverage, it’s seen as a bad deal for many workers, and yet these employees have no choice to opt-out of it. Because of the many problematic issues, which were obvious from the start, Inslee and Democratic leaders are currently trying to backpedal and delay its implementation. The Legislature meets again in mid-January and is expected to take another look at the law. But until they actually make changes, the law proceeds.
There is at least one way for under-represented workers to fight back against these taxes imposed by an out-of-touch state government. Initiative 1436 has been collecting signatures this fall and winter in a well-organized campaign to change the WA Cares Fund tax to allow workers to opt-in or opt-out to the program as they wish. The initiative petition needs 325,000 valid signatures by December 31st. If it reaches that threshold, the Legislature is required by law to act on it. Lawmakers can pass I-1436 directly into law or they can send it to the voters to decide. If voters are to vote on the issue, it will be in the November 2022 election.
The reliable deadline for mailing back I-1436 petitions has already passed, so if you haven’t already signed then your signature may not count. To be ready for future initiatives, sign up and follow Restore Washington at https://restorewashington.org/ to participate in reigning in State Government. The initiative process is the most powerful tool that organized citizens have to change or counter what comes down from Olympia.
In addition to these new and increased payroll taxes, workers here also have to worry about inflation costs, due to profligate government spending, further eating into their paychecks. The Wharton School of Business at the University of Pennsylvania ran the numbers to analyze what American households will have to spend in 2021 to maintain the same living standard from 2020 or 2019. Their analysis reports that “inflation in 2021 will require the average U.S. household to spend around $3,500 more in 2021 to achieve the same level of consumption of goods and services as in recent previous years.”