The House passed a “millionaires tax” bill imposing a 9.9% tax on high earners, stirring debate on future tax reform in Washington.

OLYMPIA, Wash. — The Washington state House of Representatives passed a controversial income tax bill Tuesday dubbed the “millionaires tax.”

A House floor announcement reverberated through the chambers just after 6 p.m. Tuesday evening. 

The proposal, which was debated for more than 24 hours, now heads to the state Senate for confirmation before going to the governor’s desk for approval.

The bill survived a last-minute challenge in the Senate Wednesday evening. Republicans filed a motion challenging the scope of the legislation, described to KING 5 by Senate Majority Leader Jamie Pedersen, D-Seattle, as a “Hail Mary.” The Senate proceeded to debate before potential confirmation Wednesday evening. 

Gov. Bob Ferguson announced Friday that he would sign the current version of the bill into law, although he would review any further amendments that were passed. The bill must be signed before the end of the current legislative session March 12 for it to go into effect.

“I look forward to signing it,” Ferguson said in a statement shortly after House approval.

The bill would impose a 9.9% income tax on households earning more than $1 million annually, applying only to earnings above that threshold. The latest version of the legislation includes expanded tax breaks for small businesses and low-income families.

“It’s a really big day,” said Rep. Joe Fitzgibbon, D-West Seattle. “This has been a lot of work that’s gone into this tax reform, and we think it’s going to really pay dividends for Washingtonians.”

Other supporters said they felt it was a simple ask, especially since less than 1% of Washington’s population would be impacted by the new tax

However, Republicans argued it would drive major corporations away. They also said they fear it is a gateway to a broader state income tax.

Others, like Rep. Jenny Graham, R-Spokane, questioned its constitutionality. “Washington State can have an income tax, they just have to do it within certain parameters. And this particular policy did not do that. It has to be applied evenly, see? And that’s where I think the courts are going to come in.”

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Republicans filed dozens of amendments to the bill in an effort to slow or derail its passage. House lawmakers debated for hours Monday night, passing just several amendments clarifying bill language and creating a city and county fiscal health account to help offset revenue loss from tax reductions.

Rep. April Berg, D-Everett, chair of the House Finance Committee, said revenue generated by the tax beginning in 2029 would fund schools, health care, higher education institutions, and public safety.

“This is a 100-year change to our tax code and it’s much needed,” said Berg. “We have a very regressive tax code that is not doing anything for Washington families.”