WA Democratic leaders closer to a tax agreement

House and Senate Democrats appeared to be getting closer to agreement Thursday on an approximately $800 million tax package that leaders have been counting votes on.

The tax plan - which is being called a "go home" proposal - was posted on the House Democrats' blog Thursday morning, but was taken down by late morning.

The exact numbers were still in flux. But the biggest chunk was a temporary tax increase for service businesses that would bring in about $245 million. Taxes on cigarettes, bottled water, soda, candy and gum and mass-produced beer would add nearly $262 million.

Nearly $58 million of that would come from the higher beer tax of 50 cents per gallon. That would drive up the state tax on a six-pack by around 28 cents, leaving it at a total of about 43 cents, officials said. Microbrews would be exempt. About $38 million would come from a 2 cents-per-can tax on soda.

Like the service business tax increase, the beer and soda taxes would also be temporary, ending in June 2013.

The compromise package comes with just days left in the 30-day special session as lawmakers work to patch a $2.8 billion budget deficit. The regular 60-day session ended March 11, and the overtime session will expire on Tuesday.

The package does not include previous proposals to increase taxes on banks' mortgage interest, out-of-state retail shoppers, and custom software products, three elements that had been supported by House Democrats. Also gone is the sales-tax hike, which had been favored by Senate Democrats.

It does include several elements previously agreed to by both chambers, including extension of the sales tax to bottled water and a rewriting of the tax code aimed at collecting more money from businesses based outside Washington.

Senate Majority Leader Lisa Brown, D-Spokane, and House Speaker Frank Chopp, D-Seattle, appeared optimistic after a Thursday morning meeting with Gov. Chris Gregoire.

"We're working together and making progress," Brown said.

Gregoire spokesman Cory Curtis said that both sides were still counting votes among their members Thursday.

"The governor is reluctant to go out and claim victory and say this is a done deal," he said. "But she's remaining optimistic. We're closer than we have been."

Rep. Jeff Morris, a Mount Vernon Democrat who serves as deputy speaker, said on his Twitter page Thursday that if they can get the necessary minimum 50 votes in the House and 25 in the Senate, "we can go home."

"If we have the votes the budget writers can put the final budget together," he wrote. "Taxes are a serious decision not done easily or taken lightly."

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On the Net:

House Democrats: http://hdcadvance.blogspot.com/2010/04/go-home-proposal.html

Legislature: http://www.leg.wa.gov

Governor: http://www.governor.wa.gov