Gov. Jay Inslee’s Friday veto of a tax break for manufacturers continues to draw the ire of business groups and Republicans alike.
“The governor’s decision to veto part of a bill that was agreed upon in good faith by a bipartisan group of legislators, and passed with a bipartisan super-majority in both chambers, is a missed opportunity to help small- and medium-sized manufacturers in rural parts of the state that are still struggling, such as marine manufacturing in communities like Colville, Clarkston and Port Townsend,” said Kris Johnson, president of the Association of Washington Business.
The tax break, which lowers the manufacturing business and occupation tax rate, was part of an incentives package that actually included 13 tax breaks aimed at various businesses. Inslee signed 11 of them into law, but nixed two through line item veto: the aforementioned B&) tax decrease and a sales tax exemption for TransAlta for converting its coal plant into natural gas.
The break would have lowered the B&O rate by 40 percent for roughly 10,000 manufacturers statewide, granting those businesses the same rate initially granted to Boeing and other aerospace firms in 2003. Republicans were adamant on the break as part of the deal that avoided government shutdown last week, and upon Inslee’s veto, GOP voices have come down hard on the Democratic governor.
“These vetoes demonstrate Jay Inslee has no respect for the working men and women of Washington state – the people these incentives were designed to benefit,” said Sen. Doug Ericksen, R-Ferndale. “At the same time, he has lost the respect of the Legislature. I am confident we will be able to override these vetoes because of the overwhelming support this bill received in the House and Senate.
“In the Legislature, we believe a deal is a deal. But when the governor vetoes an agreement reached by his own party, how can we trust that any compromise will be upheld? When you break trust, you don’t get it back, and Jay Inslee has lost the trust of the entire Legislature.”
“Our state needs a strong private sector to support the important services and programs that come from the public sector,” added Senate Majority Leader Mark Schoesler, R-Ritzville. “Yet the manufacturing sector has continued to decline, especially in rural Washington, even though other sectors of the economy are experiencing a boom in certain parts of the state.
“Late in the legislative session we saw an opportunity to help preserve jobs and encourage job growth by extending the aerospace-only tax rate to all of manufacturing. When the bill came forward, Democrats and Republicans in the Legislature agreed by an overwhelming degree. It makes you wonder what kind of pressure could have led the governor to come out today against a policy that was supported by a budget he praised just a week ago.”