Seattle Tech Entrepreneur Warns Income Tax Will Drive Talent Out of Washington

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A Seattle tech entrepreneur named Jesse Proudman says Washington's new 9.9% income tax on income over $1 million is already causing an exodus of founders, investors, and high-earning tech professionals from the state. Proudman warns the exodus could accelerate as the policy takes effect, with tech talent relocating to cities in states without personal income taxes like Austin, Miami, Nashville, and Las Vegas.

Why it matters

Washington's tech economy is already facing disruption from the rise of AI, and the new income tax could further damage the state's competitiveness in attracting and retaining top tech talent. The tax comes as broader economic indicators show strain, with recent layoffs at major employers and weakening business confidence.

The details

Proudman, a longtime Seattle entrepreneur, says he began noticing the issue gaining urgency after conversations with other entrepreneurs in the city's startup ecosystem. He says a "close friend" who founded the Foundations workspace, Aviel Ginsberg, was "screaming" about people already leaving or planning to leave the state. Proudman's own article on the topic revealed "so many people" he knows and respects in the community have already left or are planning to.

• The income tax was passed by Senate Democrats earlier this year under SB 6346.
• Proudman says the timing of the tax could not be worse, as Washington's tech economy is already undergoing disruption due to the rapid rise of artificial intelligence.

What they’re saying

What’s next

The fight over the income tax is just beginning, as Proudman and others in Seattle's tech community push back against the policy they believe could damage the state's economic foundation.