Inslee proposes carbon tax, other changes to pay for education

Washington state could completely fund its public schools for the first time in decades. Governor Jay Inslee rolled out his budget proposal Tuesday, and it includes major investments in education.

Inslee, a Democrat, laid out his formula for how the state could bring in $4 billion over the next two years. In short: higher taxes for some, lower taxes for others and a new carbon pollution tax.

Most of the money would go toward education. Inslee said he knows it sounds bold.

Inslee: "But I will just tell you we are a big and bold state. We are the state that built the Grand Coulee Dam, the state that build the Boeing 747, and we're the state that can fully fund basic education after 30 years."

Under Inslee's budget proposal, teachers would make about $20,000 more a year. Also, every school district would get more state money.

For example, Seattle's School District would get $1,400 more per student, and Spokane's would get $1,900 more per student. Inslee’s office has produced a map showing how much every school district would get.

Nearly every school would also get a new counselor or nurse, starting with the poorest schools.

The plan relies on increasing some taxes and closing a few tax loopholes. The business and occupation tax would increase by 1 percent, but more employers would be exempt. The state would charge a 7.9 percent capital gains tax that would apply to sales of stocks and bonds.

In addition, Inslee wants to create a new tax on the state's biggest carbon polluters, which would go into effect in 2018.

As for loopholes, the state would impose a tax on bottled water and vehicle trade-ins.

At the same time, property taxes would decrease for a majority of households and businesses. One-quarter of households and businesses would still pay the same local property tax.

Inslee's plan would need approval from lawmakers, who will propose their own budget ideas in the coming weeks. The state Supreme Court has found the legislature to be in contempt of court for failing to fund education.