Yesterday, Bill Gates Sr., alongside other advocates, announced efforts to move forward an income tax proposal for the November ballot.

Initiative 1077 would be limited to the top 3 percent of earners in the state. The Initiative would allow the earnings above $400,000 for couples at 5% and above $ 1million at 9% to be taxed.  The thresholds would be half of those for individuals.

In addition, the Initiative would reduce the state’s share of property tax by 20% and create large tax credits for small businesses, minimizing the number of businesses that would pay any B&O tax. 

Income-tax initiative
I-1077

• Individuals would pay 5 percent income tax on earnings over $200,000 a year and 9 percent on earnings over $500,000. For couples, those tax rates would kick in at $400,000 and $1 million, respectively.
• The state portion of property tax would be reduced by 20 percent, or slightly more than $160 on the typical $371,800 King County home, according to figures from the assessor’s office.
• The credit on state business and occupation taxes would rise from $420 to $4,800 a year, eliminating that state tax altogether for 80 percent of businesses and reducing it for another 10 percent, proponents say.
• Income-tax revenues would offset reductions in property and B&O taxes and would funnel an estimated $700 million into an education trust account for class-size reduction and other purposes, and $300 million to the Basic Health Plan and long-term care.

Initiative 1077 is expected to generate $1 billion a year in new money for education and health programs given these parameters.

The I-1077 campaign will need to collect more than 241,153 valid voter signatures by July 2 to qualify for the November 2 ballot.