Matt McIlwain, the managing director of Seattle-based VC firm Madrona Ventures, says that the capital gains tax will stifle job creation, innovation, and investments in Washington state.
The move comes as the state Supreme Court upheld an excise tax on capital gains, resulting in a new 7% tax on capital gains last Friday.
- McIlwain
argues that the state already has one of the highest excise tax rates
in the nation, which led to a $10B tax revenue surplus last year.
- He
adds that the current tax structure provides a nurturing environment
for investment, job creation, and work opportunities, which may be
affected due to the increased tax rates.
- According to McIlwain, companies will likely leave Washington state due to the new excise tax on capital gains income.
- Lastly,
he says that the excise tax violates the commerce clause within the
U.S. Constitution since it also impacts activities conducted outside the
state, which excise taxes cannot.
