Washington State Unveils Revised Income Tax Proposal

Governor Praises New Version Focused on Early Learning and Lower-Income Families

Published on Mar. 7, 2026

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The Washington state House Democrats have released a revised income tax proposal that increases funding for early learning programs, expands tax credits for lower-income families, and eliminates sales tax on more consumer products. Governor Bob Ferguson has praised the 107-page rewrite of Senate Bill 6346 and pledged to sign it into law if passed by the legislature.

Why it matters

The revised income tax bill represents a significant overhaul of the state's tax system, aiming to make it more equitable and affordable for Washington families and small businesses. The expansion of early learning programs and tax credits for lower-income residents are seen as key steps in addressing economic disparities.

The details

The new proposal includes a 9.9% tax on household income over $1 million per year, with 5% of the annual tax proceeds earmarked for the state's Fair Start for Kids program to promote access and resources for child care and early learning providers. It also eliminates sales tax on a greater number of consumer products and exempts public schools from paying a new sales tax on services. Additionally, the bill increases assistance for lower-income families and eliminates funding for public defense in local courts statewide.

  • The revised income tax proposal was released by Washington state House Democrats on Friday, March 6, 2026.
  • The legislative session is scheduled to end on March 12, 2026.

The players

Bob Ferguson

The governor of Washington state, who has praised the revised income tax proposal and pledged to sign it into law if passed by the legislature.

Washington State House Democrats

The state legislators who released the revised income tax proposal, which aims to increase funding for early learning programs and provide more assistance for lower-income families.

Senate Bill 6346

The legislation that the revised income tax proposal is based on, which would impose a new 9.9% tax on household income over $1 million per year.

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What they’re saying

“I strongly encourage the Legislature to pass this bill. It represents a historic step forward in rebalancing our unfair system and making life more affordable for Washington families and small business owners.”

— Bob Ferguson, Governor of Washington (dailyfly.com)

What’s next

The Washington state House has not yet scheduled a vote on the revised income tax proposal, and the legislative session is scheduled to end on March 12, 2026.

The takeaway

The revised income tax proposal in Washington state aims to make the tax system more equitable by increasing funding for early learning programs, expanding tax credits for lower-income families, and eliminating sales tax on more consumer products. The governor's support for the bill suggests it has a strong chance of passing, though it may still face challenges before the legislative session ends.