Democrats Raise Taxes, Slash Services in Record-Breaking Blue State Budget [WATCH]

Washington Governor Bob Ferguson on Tuesday signed into law a $77.9 billion state operating budget for 2025–2027 that includes what is now the largest tax increase in the state’s history.

The measure has drawn immediate criticism from Republican lawmakers, who accuse Ferguson of abandoning earlier pledges to protect working families and avoid tax hikes.

#UnaffordableWA #waleg pic.twitter.com/O8hA0wjS6n

— WA Senate Republicans (@WashingtonSRC) May 20, 2025

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The new budget represents an 8.2 percent increase in spending over the previous cycle.

It comes amid claims of a $16 billion budget shortfall.

The budget package introduces six major tax increases: hikes on sales tax, property tax, gas tax, and the state’s business and occupation (B&O) tax, along with expanded fees on services such as childcare and outdoor recreation licensing.

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The tax increases are projected to raise $12.2 billion over the next four years — $9.3 billion from state-level taxes and $2.9 billion from local levies.

Estimates suggest the average Washington family of four could pay up to $2,000 more per year by the fourth year of the budget cycle.

While Ferguson had previously proposed $4 billion in budget cuts, he ultimately reduced only $25 million in spending following pushback from within his party.

At a press conference explaining his decision, Ferguson said, “I said, hey, we’re not going to be able to tax our way out of this. It became equally clear early on in the process that we’re not going to cut our way out of it.”

He acknowledged public frustration over the gas tax hike, which will increase by six cents per gallon, saying, “No one’s excited about increasing the gas tax, I can assure you.”

Congratulations to Governor Bob Ferguson on signing the largest tax increase in Washington state history

$9 billion in tax increases that translate to $2,000-$5,000 more in taxes per year for your family

Make sure to thank a Democrat pic.twitter.com/SPe8wQHbJU

— Ari Hoffman 🎗 (@thehoffather) May 21, 2025

Republican lawmakers responded sharply, accusing Ferguson of breaking his word and worsening the cost-of-living crisis in Washington.

“Governor Ferguson told his own party to rein in the tax hikes and shift course. That turned out to be all talk,” said House Republican Budget Leader Rep. Travis Couture.

“Today, he gave the green light to a budget that taxes the joy out of Washington, attacks job creators, and worsens our affordability crisis.”

Senate Republican Leader John Braun added, “On his first day in office, Governor Ferguson spoke of fiscal responsibility, yet today he’s supporting the largest tax increase in state history.”

The full list of tax increases includes:

• $5.6 billion from increased B&O taxes on businesses
• $2.6 billion from expanded sales taxes on goods and services, including housing and healthcare
• $1.6 billion from property tax increases
• $637 million from expanded income and capital gains taxes
• $385 million from new taxes on services such as storage units
• $281 million from a new tax on electric vehicle manufacturers, referred to as the “Tesla Tax”

Additional fee increases include:

• Doubling of child care copays
• Tripling of nursing home per-bed fees
• 38% increase in hunting and fishing license fees
• 50% increase in Discover Pass park access fees
• Increases in liquor license fees

Despite the revenue increase, several state programs are being reduced or eliminated.

Among the cuts: funding for underperforming K-12 schools, the Tiffany Hill Act (which supports domestic violence victims), dental reimbursements for low-income residents, postpartum healthcare coverage, and hospital reimbursements for public employee patients.

Senator Chris Gildon criticized the budget’s spending priorities, stating, “They say a budget reflects priorities. The Democrat majority, and now the governor, have chosen to support a budget that cuts funding for behavioral health, public health, and higher education — despite the largest set of tax increases our state has ever seen.”

Senator Nikki Torres, assistant Republican budget leader, said, “The governor’s actions have fallen short of his words. In January, he said our state was unaffordable; by approving both the budget and tax increases today, he is making Washington even more unaffordable.”

“Governor Ferguson warned his fellow Democrats about using gimmicks to balance the budget, but they did it anyway, and he didn’t veto it,” she added.

“Only one tax qualifies as progressive, and the biggest of the taxes will increase the cost of virtually everything Washingtonians buy — including food, housing, healthcare, prescription drugs, even TV streaming.”

Torres concluded, “The governor said protecting working families from higher taxes was ‘the most important thing.’

This budget and the tax bills do the opposite.

He should have vetoed the whole thing and called us back to Olympia to try again. Republicans had a better way.”

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