FACEBOOK: No Sales Tax on Electric Cars

Reuven CarlyleReuven Carlyle on Governor Inslee’s Proposal for a Sales Tax Exemption for Electric Cars

Let’s have an authentic conversation: Electric vehicles rock and our nation’s massive subsidy of fossil fuels does not. I even admit I dream in Tesla red, and I led the fight against the anti-Tesla bill. But the public has made it clear we are a sales tax state not an income tax state. When we eliminate the sales tax on popular consumer and business items we pay a huge price in lost revenue for public education, which is half the entire state budget, and we eliminate the negative externality of our unfair tax structure for those with political strength. To me, tax policy should be depoliticized low rates, broadly applied with few exemptions rather than high rates, narrowly applied to those without lobbyists, and many exemptions–most of which don’t directly help middle class and working folks who rarely get carved out. I’ve asked Governor Jay Inslee for a real business plan that shows the incremental impact of sales tax elimination on electric vehicle sales. If he wants this tax break I respectfully invite him, like all others in Olympia, to propose a specific, off-setting revenue source or spending cuts to pay for it. It’s a huge cost of probably $60M over four years (about what we need for mental health or all-day kindergarten for low income kids) yet the marginal benefit to dramatically increasing sales of electric vehicles is unclear. There is useful social good but there is also real, out-of-pocket cost to this policy and I am merely suggesting it is not innocuous. I suggest we prioritize public and private infrastructure investment for charging instead of retreating to the automatic idea of creating an across the board tax break that isn’t even progressive in structure. I am truly and objectively open to this policy debate and look forward to learning more, and sincerely welcome advice and data from the public. We have 650 tax breaks in Washington, more than any state, and I’m not enthusiastic about creating more without unassailable proof of a strong return on investment for taxpayers. Your thoughts?

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  1. theaveeditor #

    I echo Reuven’s concerns. The idea of a tax break on Teslas seems to me to be liberalism for the rich. Most of the people served by state revenues are not wealthy enough to buy a Tesla.

    Even from a simple political point of view, the image of a well-to-do person, say Nick Hannuaer, buying a Tesla and not paying sales tax is not a good image.

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