Washington’s Proposed Statewide Wage Tax: What You Need to Know

Lawmakers in Olympia are pushing a new statewide payroll tax modeled after Seattle’s JumpStart tax. The proposal would hit large employers—those more than $7M in payroll in the prior calendar year.

The tax is 5% on wages above the FICA wage base. Lawmakers claim it could raise billions for housing, healthcare, education, and other social programs.

Supporters frame it as a way to make big companies “pay their fair share.” Critics warn it will send jobs, investment, and future growth straight out of Washington. Cities like Bellevue are already openly worried about losing major employers.

The bill also creates a new “Well Washington Fund,” which would oversee and distribute the revenue. Details on oversight, governance, and accountability are thin — raising obvious concerns.

Bottom line: whatever your politics, this is a massive structural tax change that would significantly alter Washington’s business environment. If it passes, employers will rethink hiring, expansion, and even geography. And once a tax like this is in place, it rarely disappears.