Possible new phone tax brings budget deal closer

by: Essex Porter Updated:

OLYMPIA, Wash. —

Gov. Jay Inslee maintains a budget deal to avert a government shutdown is "imminent.”

But more than a day after his announcement, there was still no deal between Democrats and Republicans in the House and Senate.

"I would say we've agreed to resources and a lot of the major policy decisions have been agreed to," said Medina Sen. Rodney Tom (D), leader of the Republican-dominated Senate. "We're trying to work out the fine details so that when we shake hands, everybody's on the same page.”

Both houses need to pass a budget deal by 11:59 p.m. on Sunday night to prevent a government shutdown on Monday, July  1.

Tom confirms that a likely new tax on land-line telephones is one of the reasons that negotiators are very close to a budget deal.

Consumers already pay state and local taxes on cable TV, cellphones and phones that use the Internet. The new land-line tax is response to an industry demand to treat all telecommunications services equally or face a $1 billion lawsuit from the industry.

Consumers would pay . 95 cents a month for each land-line. The tax would add $85 million to state coffers.

 "It's an essential piece of a larger package," said Seattle Representative Reuven Carlyle (D), who chairs the House Finance Committee.

 "It's critical not only because of the revenue but really because of the policy, the fairness and people who have a cellphone, a  home phone, cable, DSL --  they should pay the same level of taxes,” said Carlyle.

While furlough notices have gone out to 26,000 state employees, lawmakers remain confident they'll pass a budget before a government shutdown takes effect.

"Like I've been saying for two weeks with absolute certainty that's not going to happen," said Tom.