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Washington Tech Leaders Warn of Talent Flight Over Proposed Tax Hikes
CEOs say new income and capital gains taxes would undermine state's tech sector growth
Published on Mar. 2, 2026
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A group of tech leaders in Washington state have written a letter to the governor warning that proposed new income and capital gains taxes would 'materially undermine' the state's ability to keep growing its tech sector, a core driver of the economy. The letter says the tax hikes would slow AI innovation and investment momentum, and cites a recent survey showing over 40% of businesses may leave the state if the taxes are implemented.
Why it matters
Washington state is home to many major tech companies and has become a hub for AI and other cutting-edge industries. The tech leaders argue that raising taxes could jeopardize the state's status as a tech and innovation leader, potentially leading to an exodus of talent and businesses that would damage the broader economy.
The details
In the letter, a dozen tech leaders urge Gov. Bob Ferguson to 'pause the state's efforts to create a state income tax and increase the capital-gains tax.' They warn the tax hikes 'would materially undermine Washington's ability to keep growing the tech sector, which is a core driver of our economy, and would slow the AI innovation and investment momentum.' A recent survey by the Association of Washington Businesses found that more than twice as many businesses report they may leave the state since the tax increase plan was announced, and 44% of business owners are considering moving their personal residence out of Washington.
- The letter from tech leaders is set to be released on Monday, March 1, 2026.
The players
Bob Ferguson
The governor of Washington state.
Association of Washington Businesses
A business association that conducted a survey on the potential impact of the proposed tax increases.
What’s next
The governor is expected to respond to the letter from tech leaders in the coming days.
The takeaway
The proposed tax increases in Washington state have sparked a backlash from the tech industry, which warns the higher taxes could drive businesses and talent out of the state and undermine its position as a hub for technology and innovation.
