Washington To Collect Nearly $1B More Revenue For 2021-23

OLYMPIA, WA — New estimates from Washington State Economic and Revenue Forecast Council show the Evergreen State collecting nearly $1 billion more in revenue during the 2021-2023 biennium than previously expected.

The council's latest forecast increased the revenue estimate by $927 million, for a total $59.3 billion for the current, two-year state budget cycle. The biennium budget cycle began back on July 1.

The news continues a trend of growth for tax revenues. In June, the same council announced that the Near General Fund revenue collections had increased by $1.8 billion.

“Trends in collections are still improving though there are some uncertainties on the horizon,” said Steve Lerch, executive director of the Economic and Revenue Forecast Council.

The newest forecast also increases projections for the next biennium, up $931 million more to $63.1 billion for the 2023–25 biennium.

As for where that money is coming from, it's a variety of sources. One factor is that there are more Washingtonians, and thus more taxable business transactions, than ever before. Another is that several industries saw their tax payments return to normal as their business rebounded from the COVID-19 pandemic. Tax payments by businesses in the accommodation and food services sector, for example, increased 59.2 percent over the last year as restaurants reopened their doors to customers. The total payments in the retail trade sector also increased 11.2 over the last year.

Though retailers are paying more taxes, the cost hasn't trickled down to consumers, the council said. Instead, their report indicates Puget Sound consumer price inflation matched the national average.

The rebounding tax forecast is good news for a state struggling to find its economic footing following last year's pandemic lockdown and mass unemployment. In June, the Washington State Economic and Revenue Forecast Council said the state's revenue projections had recovered to pre-pandemic levels, and this week's forecast shows it has only improved in the months since.

“The budget passed in the spring is clearly sustainable for the coming years,” said OFM Director David Schumacher. “Thanks to the resilience of our economy, we can continue to invest in the people of Washington as we emerge from this pandemic.”

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