Today's Opinions: Post and Tracfone

Posted on October 28, 2010 by Trent England

In re Detention of Post, No. 83023-1. Charles Post was convicted in 1987 for first degree burglary and rape. Before his scheduled release from prison in 2003, King County petitioned for Post's civil commitment as a sexually violent predator (SVP). The first commitment trial led to a hung jury; after the second trial, the jury found that Post was an SVP. At the second trial, but not the first, prosecutors had introduced evidence about the treatment that would be available to Post if he was committed. Post objected, but the trial court denied his motions. The trial court also refused to allow Post to introduce evidence that, if he was released, he could be subject to a later SVP commitment petition for a "recent overt act."

Post appealed these determinations of the trial court and a divided Court of Appeals reversed his commitment and remanded for a new trial. Today, the Supreme Court in an opinion by Justice Owens agrees with the Court of Appeals and with Post. Evidence of possible future treatment was irrelevant and was not harmless error. Furthermore, evidence that Post could later be subject to an SVP commitment petition was relevant and should have been admitted. Six other justices signed the majority opinion.

Justice Stephens concurs with the outcome but offers a more limited rationale. The Chief Justice concurs in part and dissents in part. She would exclude the state's treatment program evidence, but would also exclude Post's evidence of the possibility of a later petition. (briefs, argument)

Tracfone Wireless, Inc. v. Dep't of Revenue, No. 82741-9. Tracfone, which sells prepaid wireless phone service, sued the Department for a refund of the enhanced 911 excise tax. A bare majority of the Court today upholds the trial court's grant of summary judgment for the Department, holding that RCW 82.14B.030 applies to prepaid wireless phone service as it does to any other wireless phone service.

In effect, TracFone is seeking a decision that whether the tax is owed depends upon how a company decides to market and charge for its service or, to put it another way, whether the tax must be paid depends entirely upon the individual company's business model.

The Chief Justice writes for the majority. Justice Chambers, joined by three other justices, dissents. He argues that tax statutes must be narrowly construed and, where there is ambiguity, construed in favor of taxpayers. Looking beyond the statutory description of the tax to the statutory language that governs how the tax is collected, the dissent finds that the legislature did not anticipate the tax applying to pre-paid wireless services. (briefs, argument)

Summaries of today's three unanimous decisions will be posted soon.

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A history of the income tax in Washington state

Posted on April 3, 2009 by Michael Reitz

Faced with the state’s current budget crisis, lawmakers have raised the possibility of an income tax. The idea has been debated for years, but this discussion is more than a mild flirtation. Senate Majority Leader Lisa Brown and House Speaker Frank Chopp have both signaled a willingness to test the voters’ appetite for a new tax structure.

But is an income tax constitutional? Would the law require a constitutional amendment? These are questions lawmakers are now wrestling with. The state income tax has had a troubled history in Washington, and any new proposals would have to clear the exceedingly-high hurdles of constitutional review and voter approval. The Washington Supreme Court has struck down numerous income tax laws, and voters have rejected eight measures in the last 75 years.

  • 1932 – Voters adopt a graduated income tax. Initiative No. 69.
  • 1933 – Supreme Court strikes down the income tax as unconstitutional. Culliton v. Chase.
  • 1934 – Voters reject constitutional amendment allowing for income tax.
  • 1935 – Legislature adopts a 3% net income tax. Personal Net Income Tax Act of 1935.
  • 1936 – Supreme Court strikes down Personal Net Income Tax Act. Jensen v. Henneford.
  • 1936 – Supreme Court strikes down corporate net income tax. Petroleum Nav. Co. v. Henneford.
  • 1936 – Voters reject constitutional amendment SJR 7 allowing for income tax.
  • 1938 – Voters reject constitutional amendment SJR 5 allowing for income tax.
  • 1942 – Voters reject another income tax measure. 
  • 1951 – Legislature adopts a 4% corporate excise tax. Laws of 1951, Extraordinary Session, chapter 10.
  • 1951 – Supreme Court rejects the corporate excise tax. Power, Inc. v. Huntley.
  • 1970 – Voters reject constitutional amendment HJR 42 allowing for income tax.
  • 1973 – Voters reject a HJR 37, providing for corporate and personal income tax, by a 3-to-1 margin.
  • 1975 – Voters reject Initiative 314, a 12% corporate income tax proposal.
  • 1982 – Voters reject Initiative 435, a corporate income tax proposal.

If the Legislature adopts an income tax, only one thing is certain: the issue will come before the Washington Supreme Court. Public finance attorney Hugh D. Spitzer of Foster Pepper has suggested that the common perception that an income tax is unconstitutional may not be accurate, as the case law guiding the Supreme Court in Culliton has since been overturned. But will that reassure lawmakers who have to sell the idea to the voters of Washington?

(Note: Phil Roberts has written an exhaustive review of the income tax in Washington state: A Penny for the Governor, a Dollar for Uncle Sam, 2002.)

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