Lu Hill: For healthier communities, we need to fix our tax code

By Lu Hill

In my previous column, I wrote about the important role that taxes play in supporting all our communities by funding the resources we all need to thrive, like libraries, schools, parks, and public transportation, to name a few.

But our tax system in Washington state could do much more for all of us if it weren’t so upside down. What I mean by that is that people with the lowest incomes pay a significantly higher percentage of taxes as a share of income than the wealthiest in our state. This exacerbates racial inequities given that Black, Indigenous, and People of Color (BIPOC) are more likely to have lower incomes because of historical and persistent policies designed to favor wealthy white people and profitable corporations while keeping BIPOC folks from building wealth. (If this is news to you, I encourage you to do a google search of terms like redlining, biased banking practices, and GI Bill discrimination.)

In fact, Washington has long had the most inequitable tax code of all 50 states. Politicians here have designed and maintained a tax code that allows a powerful few to build unimaginable amounts of concentrated wealth by not paying what they truly owe. Meanwhile, the rest of us have to foot the bill for the public services we all need to thrive. And because we over-rely on regressive taxes, like the sales tax, we don’t have enough to actually fill our state coffers.

All that means our state budget is not keeping pace with the needs of our communities. In fact, our state budget never bounced back to adequate funding levels after the massive, harmful cuts lawmakers made during the 2008 recession.

In the meantime, we’re all seeing the impacts of under-funding of critical public services. As we deal with the fentanyl and substance use disorder crises in particular, our friends and neighbors need support. There isn’t one be-all-end-all fix. But one thing I know for sure is that greater investments in our budget through equitable taxes are a critical part of the solution.

For all our communities to thrive – especially as we’re still facing the fallout of the pandemic and we’re in the midst of a mental health crisis, particularly among young people – we need ample support for behavioral health providers and for young people experiencing a behavioral health crisis. We need increased access to opioid treatment and prevention services. We need continued investments in projects that make it easier to access life-saving resources like Naloxone for overdose prevention. We need greater mental health supports, substance use counseling, emergency crisis intervention, and psychiatric treatment.

And that doesn’t even mention the need for greater investments and reforms to other essential resources, like Medicaid, public health, wraparound services for people experiencing homelessness, unemployment insurance, and the like.

To those people who say that nonprofits and philanthropy should be the answer: That’s not a viable solution. They provide essential support for people with addiction and behavioral health issues, but the problem is too big for them to solve alone.

Lawmakers can’t keep making small, incremental budget updates that don’t actually meet our needs. While it’s good that there were some behavioral health investments in the state budget this year, it is not enough.

But lawmakers can’t make meaningful budget investments if powerful special interests keep fighting every tax proposal that seeks to ensure the ultra-wealthy and corporations actually pay their share. The legislature has refrained to move forward common-sense reforms to the wealth tax, estate tax, and corporate tax loopholes in recent years. This is in large part because some rich people keep spreading the myth that they are being hurt by a tax code that, in truth, hurts people with low and middle incomes and BIPOC.

The good news is that advocates recently came together to demand our lawmakers start to make our tax code more equitable by passing the capital gains excise tax on the ultra-wealthy and by passing the Working Families Tax Credit, a new state tax credit for people with low incomes. These were big wins in the right direction, but there’s a lot more work to do.

We all deserve the opportunity to get care and support when we’re struggling or facing a personal crisis. To get there, we need to get more vocal and spread the word about the tax code and the need to reform it to ensure it’s no longer rigged in favor of the elite few.

Lacrecia “Lu” Hill is a fourth-generation Spokanite who has long been involved in supporting the community in the nonprofit, philanthropic, and small business sectors. She currently is the community engagement and strategy director at Empire Health Foundation. These thoughts are her own.