Lawmakers Miss Opportunity to Repeal Long-Term Care and Payroll Taxes Act » Publications » Washington Policy Center


The State House yesterday approved legislation that would delay a new payroll tax due to begin this month, assessing 58 cents on every $100 of a worker’s income. Money taken from people’s paychecks would fund a social long-term care program when a resident of the state can no longer lead an independent life. The bill now moves before the Senate Ways and Means Committee, scheduled for a public hearing at 4 p.m. Monday, followed by an executive session in the committee on Tuesday.

The legislation was sped up after Gov. Jay Inslee requested a delay in December, admitting the law he backed — and which Democrats celebrated — has serious flaws. (Read more about these flaws in my opinion pieces here and here and on my blog.) The governor’s insistence and admission came after more than 450,000 people were exempt from taxes, taking about a third of the salaries the program was count on 2022 with them.

Internal Bill 1732, one of the fast-moving bills, would delay taxation until July 2023 and create a way for soon-to-be-retired people to eventually qualify for some of the program’s promised benefits, even without paying in 10 years. The other, House Bill 1733would allow more groups of people who will not benefit from the program, due to residency or military ties, to opt out of the tax.

Of the delay, House Democratic Majority Leader Pat Sullivan said the pause was necessary “to ensure the program is as effective and efficient as possible, so that we can deliver these benefits to our residents in whole state”. The problem with that? There is no guarantee of benefits.

The state’s unpopular long-term care law only guarantees that workers will pay another tax for all their working years. They will only maybe get a paltry $36,500 lifetime benefit, which is insufficient for most people’s long-term care needs. If you are a low-income worker, your salary is also guaranteed to be reduced today to pay for the long-term care needs of other people – sometimes people with higher incomes.

The program lacks compassion and common sense.

The program is non-portable, so move out of state and you lose the ability to claim the promised benefit. Are you not eligible for three necessary activities of daily living as defined by the state? There is also no benefit for you. If you are lucky and do not need long term care at some point in your life, you will have made a bad investment to pay for the things you will need or want.

The bills that are advancing do not solve any of this. More worryingly, they make it even more likely that the tax will increase or the benefit decrease in order to achieve program solvency.

Several Republican amendments were proposed on Wednesday, including one that would require voter approval of the program for the payroll tax to take effect in July 2023. They were rejected or ruled out of order. The repeal bills were not even considered.

Creating a safety net for needy and non-needy people, and limiting the income of each salary group, is not good policy. Legislators should not pass up the opportunity to get rid of a fatally flawed law.

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