Lawsuit Aims to Block Washington's New Income Tax

Bipartisan legal challenge seeks to invalidate 9.9% tax on income over $1 million.

Apr. 10, 2026 at 10:51pm

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A serene, cinematic painting of a government or office building in warm, golden light, capturing the quiet tension and uncertainty surrounding the legal challenge to Washington's income tax.The legal battle over Washington's new income tax could have lasting impacts on the state's business climate and economic future.McKenna Today

A coalition of taxpayers, small business groups, and farm organizations has filed a lawsuit in Klickitat County Superior Court to block Washington's newly enacted income tax. The lawsuit, led by former Attorney General Rob McKenna and former state Supreme Court Justice Phil Talmadge, argues the 9.9% tax on income above $1 million violates the state constitution.

Why it matters

The legal challenge signals a high-stakes battle over the future of Washington's tax structure, with opponents arguing the income tax threatens the state's longstanding competitive advantage of having no state income tax. Business groups warn the tax could have immediate economic consequences, potentially driving companies and entrepreneurs to relocate.

The details

The complaint seeks to invalidate Senate Bill 6346, arguing that under Washington's constitution, income is considered property that must be taxed uniformly and cannot exceed a 1% rate. The lawsuit points to nearly a century of legal precedent, including a 1933 state Supreme Court ruling striking down a graduated income tax. The broad coalition backing the lawsuit includes the National Federation of Independent Business, the Building Industry Association of Washington, and the Ethnic Chamber of Commerce Coalition.

  • The income tax is set to take effect in 2028.
  • The lawsuit was filed on April 10, 2026.

The players

Rob McKenna

Former Washington Attorney General leading the lawsuit.

Phil Talmadge

Former state Supreme Court Justice involved in the lawsuit.

Citizen Action Defense Fund (CADF)

The coalition of taxpayers, small business groups, and farm organizations that filed the lawsuit.

National Federation of Independent Business

One of the business groups backing the lawsuit.

Building Industry Association of Washington

One of the business groups backing the lawsuit.

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What they’re saying

“This law disregards both the plain language of the Constitution and decades of consistent Supreme Court precedent. We are confident the courts will strike it down.”

— Rob McKenna, Former Washington Attorney General

“This legislation is not a close call—it is a direct conflict with settled constitutional law.”

— Phil Talmadge, Former state Supreme Court Justice

“This tax adds another layer of instability that makes it harder for entrepreneurs to grow, hire, and stay in Washington.”

— Mike Sotelo, Ethnic Chamber of Commerce Coalition

What’s next

The lawsuit is expected to be a high-stakes legal battle, with the courts likely to rule on the constitutionality of the income tax law.

The takeaway

This lawsuit highlights the ongoing debate over Washington's tax structure and the potential economic consequences of the new income tax. The outcome could have far-reaching implications for the state's business climate and competitiveness.