Hoops Tax Forum probes state tax role in racial wealth gap

Closeup of Melissa Hellmann
Melissa Hellmann

Washington’s state tax system puts a disproportionate burden on poor people and communities of color, according to reporting by Melissa Hellmann, an investigative journalist for the Center for Public Integrity.

“State tax policy could help address America’s widening economic inequality. But in most states, the research shows it makes things worse,” she said.

Hellmann is the keynote speaker at this year’s Hoops Tax Forum at Washington State University. Her talk, “The Cost of Disparity: How State Tax Policies Fuel the Racial Wealth Gap,” takes place from 5:15 to 6:45 p.m. Feb. 27 at The Spark Academic Innovation Hub Building, Room G45.

Despite Washington’s reputation as a progressive state, the state’s tax system is widely acknowledged as one of the most regressive, said Jeff Gramlich, director of the Hoops Tax Institute and accounting professor in WSU’s Carson College of Business. Three primary revenue generators – sales tax, property tax, and business and occupation tax – pass costs onto the consumer. Sales taxes, in particular, disproportionally affect low-income people.

As a result, the bottom 20% of Washington’s earners pay nearly 18% of their income in state and local taxes, according to the nonpartisan Institute on Taxation and Economic Policy. Meanwhile, the wealthiest 1% of Washington residents pay 3% of their income in state and local taxes.

Tax disparities are particularly felt in communities of color. “If you’re a Black American, it’s almost certain that you’ll pay a higher percentage of your income in taxes than white people,” said Hellmann, whose reporting is available on the Center for Public Integrity’s website.

In her talk, Hellmann will discuss the discriminatory history behind tax codes – some of which originated during the Reconstruction era after the Civil War – and possible solutions.

Washington’s recently enacted Working Families Tax Credit is an effort to address state tax disparities, Gramlich said. Low-income people can qualify for tax credits of $300 per individual or up to $1,200 for a family of four.

Hellmann is an award-winning reporter who has covered underrepresented communities throughout the world. She previously worked at the Seattle Times, Seattle Weekly, the Associated Press, YES! Magazine and TIME Asia. At the Center for Public Integrity, she writes about racial, gender and economic inequality.

The Hoops Tax Institute was established in 2012 by the late Howard (’50 Hosp. Mgmt.) and Billie Hoops to increase public awareness of tax issues.

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