The ESSB 6346 Referendum Is Dead. Stop Waiting and Start Planning.

Two days ago the Washington Supreme Court ended the referendum effort against ESSB 6346 — unanimously. The court said the law is a revenue measure necessary for state government, constitutionally exempt from popular vote. Let's Go Washington asked voters to decide. The court said they don't get to.

That's not a surprise. The legislature put a necessity clause in the bill on purpose. They saw this coming.

So now what

There's still a constitutional lawsuit — filed April 9 in Klickitat County by the Citizen Action Defense Fund, led by former AG Rob McKenna and former Supreme Court Justice Phil Talmadge. The theory is real: Washington's constitution has treated income as property since 1933, and progressive income taxes have been struck down on that basis. Ninety-three years of precedent.

But here's the thing about 93 years of precedent: the same court that just blocked the referendum is the court that will hear the constitutional challenge. And they have shown zero interest in rocking the boat.

I hope McKenna wins. I genuinely do. But I would not bet my tax planning on it.

The math on waiting

The tax attaches January 1, 2028. If the lawsuit is still working through the courts — which it will be — and you haven't moved, restructured, or accelerated income, you've handed Washington a 9.9% cut of everything you earn above $1 million. Possibly forever.

If you're married, the hit is worse. Two spouses each earning $700K pay nothing individually. Combined, they owe tax on $400K of income — roughly $39,600 a year — for no reason other than being married. That marriage penalty is baked into the statute and nobody in Olympia is fixing it.

What I tell clients

Plan as if this tax is permanent. The referendum is gone. The lawsuit is a prayer. The planning window — 20 months — is real and it is shrinking.

If you haven't started, start now.

Have questions about how ESSB 6346 affects your situation? Reach out.