The Seattle City Council disclosed a draft ordinance proposing a 2 percent tax on incomes above $250,000, according to the Tax Foundation.
The proposed municipal income tax is projected to generate $125 million in annual revenue, as around 5 percent of Seattle residents would pay the tax.
The municipal income tax ordinance is likely to face many legal hurdles in the months to come. For example, the proposed ordinance will have to overcome a provision of the Washington constitution that requires taxes to be consistent, a statutory ban on local net income taxes and court precedent that establishes restrictions on creating local taxes.
Voters in Washington have opposed income taxes numerous times. However, if this proposed ordinance survives it could change the legality of income taxes in the state.
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