Washington Business Leader Moves Out Over New Millionaire Tax
A well-known entrepreneur from Washington state is leaving due to recent tax changes that he describes as a serious shift in the state’s business environment. Jesse Proudman, the founder and CTO of Venice.ai, a platform focused on privacy and generative AI, believes that the once-friendly landscape for startups has turned hostile.
Proudman shared his feelings about the transformation of Washington, which he once saw as a “startup sanctuary.” He mentioned, “When I started my first company, the environment was very supportive. But recently, that has changed significantly.” Now, with the passage of a new “millionaire tax,” Proudman and others feel that the state is turning against business owners.
The tax, approved by the Democratic-majority legislature and signed into law by Governor Bob Ferguson, places a 9.9% tax on annual incomes over $1 million. Set to start on January 1, 2028, with the first payments due by 2029, the law is already influencing many residents’ decisions to relocate. Proudman is actively working with a group that is gathering signatures to challenge the tax in the upcoming elections.
Hallie Herzberg, a spokesperson for the group, noted that they aim to collect about 325,000 signatures by July 2 to get the measure on the ballot. “This tax is already pushing businesses and families out of Washington,” she stated.
In recent years, Washington has prided itself on having no personal income tax. However, the state Supreme Court’s approval of a capital gains tax in 2023 opened the door for further income taxes, leading some to see this as a move away from the state’s traditionally low-tax environment.
State Senator Jamie Pedersen, who sponsored the new millionaire tax, has dismissed concerns about potential business departures. He believes there is no solid evidence that high-income individuals will leave for states with lower taxes, such as Florida or Texas. Nevertheless, data from the Association of Washington Business indicates that many business leaders are considering moving their personal lives away from the state.
For Proudman, the decision is made: he plans to relocate to Austin, Texas. “It’s just not a welcoming place for business anymore,” he expressed. “With this tax, we have to look for alternatives, and Austin seems to be the next step.”
He warns that while this tax appears to target the wealthy, it could have broader implications. As successful individuals leave, the tax burden may eventually fall on the middle class. “The people are unknowingly creating a more burdensome tax situation for themselves,” Proudman stated.
As the debate about this tax unfolds, many are watching closely to see how it will affect the future of Washington and its economic landscape.
