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Seattle startup founders, investors react to new state capital gains tax (geekwire.com)
14 points by miley_cyrus on March 25, 2023 | hide | past | favorite | 29 comments



Yeah I definitely want to leave Washington state if they continue down this road.

For a time the state was socially liberal but still pretty business and tax friendly but there are too many greedy people who want to get their hands on that wealth entrepreneurs are creating.

And to build schools!? I already private tuition and our school could stand for some improvements, and our teachers deserve a bump in salary, but no we’re going to go tear down some perfectly usable elementary school to make a new more environmentally friendly one.

The money from this tax will only fatten the pockets of the bureaucrats, and will do little to nothing for the average person.

Washington in a nutshell.


This comment is perfect. I can’t tell if satire, or not. Thank you!


Right, they value the state being "socially liberal" but the second they have to contribute (as a very fortunate person) then it's a bridge too far and they want to leave. Complaining about paying for public schools and teachers as a person who literally admits to paying for private tutition is unimaginably out of touch. I too hope it's satire but unfortunately people like this exist.


Yes, people tend to develop different opinions about taxes depending on their financial situation. Perhaps a decade ago this person would have written your comment word for word -- who knows what kind of comments you will be writing as your situation develops. Only time will tell. :)


> people tend to develop different opinions about taxes depending on their financial situation

I didn't state that. No need to subvert my point by suggesting even more money could change my opinion.


I am the one stating it. I personally think that this is what happens to a lot of people. Perhaps your opinion about taxes will never change, no matter what -- but certainly some folks evolve their thinking once they get wealthy or as you yourself said act "socially liberal" only until the tithe box reaches them.


Telling someone their opinion could change doesn't contribute to the conversation and edges on ad hominem.


Interesting perspective, I never thought of it that way.

By all means, I shall call you a person whose opinion could not change. Is there a term for such a thing?


Welp, they walked right into that one ;)


Yeah, I walked into a person who refused to have good-faith discourse.


All I can suggest is for you to ask a trusted friend to read the exchange and give their take on it, preferably without priming or explaining.

Alternatively you can, for my edification, demonstrate by way of example -- how should I have phrased my initial point in a more palatable manner in your opinion?


The only "point" you offered was a character attack, you did not make an attempt to respond to any of my arguments whatsoever. I am not interested in your rude suggestions or further interaction with you.


I sincerely believe you did not read my comments as intended, nothing rude in such a suggestion as misunderstandings happen - either way, be well.


You're basically trying to invalidate that person's comment with a made-up hypothetical.


[flagged]


Since this tax has been around for about a year it's obviously too soon to see results from the funds. It doesn't appear that you're interested in charitably investigating how well it's working given you took the opportunity to generalize about several off-topic issues.


Most people with that viewpoint seem to be incredibly shortsighted, such as blaming or crediting the current president for things implemented in the last term that are finally creating an effect. This seems to be many Americans, sadly


> wealth entrepreneurs are creating

No, wealth employees are creating and ownership is profiting from.


“Taxes are the price we pay for civilized society."


Yes, but who is John Galt?


Worth mentioning that Washington has the most regressive state and local taxes in the country:

https://itep.org/whopays-map/

I’m curious where Washington will end up on the list if this goes into/stays in effect.


I’d guess they’d be worse off if they look at net worth or five year rolling income of the people paying this.

A $250K gain because your startup got acquired or IPO’ed doesn’t exactly translate into a high average salary over the many years it took to gain the windfall. (versus, say, working at Microsoft or Amazon, and getting an extra $50-100K per year.)


Not alot of poor people are realizing $250k non-real estate or retirement capital gains in a single year.


You think this tax is mostly going to affect startup employee windfalls? Seriously?

It's 7%. So if you make a 1.25M (remember how tax brackets work - it's after the threshold) - you pay WA $70k. I think there's literally no way to argue that's regressive.


So, you make $150K in salary for 10 years, and $1.25M in one year, for an average of $162K a year.

That’s below starting salary at Microsoft. You pay an average of $7K per year, and the Microsoft employees pay zero.

It is certainly not a progressive tax. If they time averaged it over ~ five years, it would be.

Another way to look at it is that they say it will affect 7000 households statewide.

It will affect pretty much all startup windfalls, so either there are only 7000 startup employees in the whole state, or they know this is going to be a windfall tax on people that have low average income.


You also make way more money than that MS employee over those 10 years. So I think paying a little ($7k is not much) more tax is fine.

Where are you getting that it only affects startup exits? Is there a source? Guessing?


Those people probably qualify for the QSBS exemption of up to $10 million.


Curious how real estate was left out of this.


Real estate, timber interests, farming interests, and auto dealers got their industries exempted. Flat out political corruption.


I think we all know quite well in terms of how and why real estate was left out of this.

Willing to bet that the ratio of politicians in Seattle that realize capital gains in excess of $250k/year vs. those that own real estate (especially multiple properties) is heavily favoring the latter group.




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