And decide later whether it’s a legal tax ... .
Washington’s Supreme Court on Wednesday agreed the state can begin writing rules to collect its hotly contested capital gains income tax long before hearing arguments about whether Douglas County Superior Court Judge Douglas Huber’s ruling the measure unconstitutional should be reversed.
In a one-page announcement citing no reasons for accepting the state’s argument for issuing a stay of Huber’s ruling, the justices granted a motion filed in November by Washington State Attorney General Bob Ferguson allowing the state’s Department of Revenue to proceed with plans to impose the tax despite a looming Jan. 26 hearing on its merits.
The Democratically controlled Legislature last year passed, and Gov. Jay Inslee signed into law a measure that would impose a 7 percent tax on income from capital gains above $250,000 a year, such as profits from stocks or business sales.
Exceptions include the sale of real estate, livestock and small family-owned businesses.
The Washington State Constitution, however, requires that such taxes be applied uniformly and cannot exceed one percent without voter approval.
Backers of the tax describe it as an excise tax, but previous court decisions have consistently regarded income as property — which must be taxed at the same rate for everyone.
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