This Washington

Inslee Calls for "Investments" and for Closing Bank Loophole

By Josh Feit September 22, 2011

We gave 2012 gubernatorial candidate US Rep. Jay Inslee (D-WA, 1) a campaign demerit for having nothing to say last week when the state announced it was facing a $1.4 billion revenue shortfall.

As the problem took center stage today—Gov. Christine Gregoire has called for a special session to deal with the shortfall—Inslee stopped being shy and spoke out.

Inslee fell short of his Democratic colleagues, who straight-up called for a balanced approach between cuts and revenue, but he did use Democratic Party-speak for taxes ("investments"), and he specifically said the legislature should consider getting rid of "corporate tax loopholes," name-checking the one Democrats are fond of hitting: the tax exemption big banks get on interest earned over $100,000 on first-time mortgages.

Here's Inslee:
I hope the legislature seriously addresses the questions about how we put ourselves on a long-term path to economic recovery and how to preserve priorities like education that create economic opportunity, and make responsible investments in our families and future. There are still options for the legislature to pursue including finding savings by closing ineffective corporate tax loopholes, such as the exemption for out-of-state banks.

It's a catchy sound bite, but let's be honest. Closing the bank loophole brings in about $100 million. We're looking at a $1.4 billion problem. The 500-plus tax breaks in the budget are worth about $6.5 billion. However, arguing one-by-one on those isn't likely to generate the necessary revenue.
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