Washington state lawmakers are preparing for the start of the regular session. Legislation filed for consideration in the coming months would boost transportation funding via an existing revenue source.
At issue is the state’s motor vehicle surtax. The tax is applied to all retail sales, leases and transfers of motor vehicles.
Collected since 2003, one-third of 1% of the sales tax is used to finance transportation preservation. The rest of the tax revenue (99.7%) is routed to the state’s general fund.
Vehicle sales tax
Sen. Curtis King, R-Tacoma, is the ranking member of the Senate Transportation Committee. He filed a bill that would tap vehicle sales taxes for transportation purposes.
His bill, SB5026, would increase the percentage of the vehicle sales tax devoted to the Motor Vehicle Fund by 16.66% yearly through 2031. At that time, it is estimated 100% of the tax would be deposited into the transportation budget.
A related bill, SB5073, would do the same thing but much quicker. Specifically, all vehicle sales tax funds would be immediately shifted from the general fund to transportation.
King said a shift is needed to help shore up the state’s transportation budget. According to Washington State Fiscal Information, the transportation budget is about $14.6 billion.
Advocates have said something needs to be done to bolster transportation funding. They’ve pointed out the state’s fuel tax collection has declined in recent years. More fuel-efficient vehicles and electric vehicles have been cited as significant reasons for declining tax revenue collection.
SB5026 would reverse the trend and result in up to $400 million moving to transportation in the first year, King said. The amount shifted annually would top $1 billion by the third year.
He added that the more money devoted to transportation would eventually make its way back to the state’s operating budget via new and higher taxes that would result from transport spending.
Both bills can be considered during the session that begins Jan. 13. LL
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