Washington Democrats Propose Tax Targetting Tesla

Democrats introduce the legislative equivalent of setting your neighborhood Tesla on fire.

The Washington State Legislature is poised to disappoint their guillotine-sharpening constituents by apparently abandoning their valiant crusade for a wealth tax, but lawmakers may scratch the peasantry’s anti-rich itch with newly proposed Senate Bill 5811. The bill would tax big car manufacturers’ windfall profits from the State’s clean vehicle program, but the policy sets a high threshold that, in effect, singles out just one brand: Tesla. With public opinion of Tesla in the absolute shitter lately, the Legislature could not have picked a better target. 

In 2020, the Washington State legislature adopted the Zero Emission Vehicle (ZEV) program, requiring automakers to sell cars that do not produce emissions — at least 5% of sales had to be electric vehicles by 2022 and 8% by 2025. If automakers exceed those requirements then they earn credits they can “bank” or sell to other companies behind on the mandate. 

The State started to realize that Tesla made a killing off the program. Enter SB 5811. The bill imposes a 2% tax when a company sells a credit to another company and a 10% tax when a company banks the credit. The Legislature does not know how much the tax will raise, but it only applies to companies that earn more than 25,000 credits. Only Tesla meets that threshold.

Over the past years, the public perception of Tesla went from a nifty, environmentally friendly car for the well-meaning tech bro to a symbol of facism, oligarchy, and all the abhorrent behavior from the company’s CEO, Elon Musk. Around the time Musk bought (and basically destroyed) Twitter, Tesla owners started slapping bumper stickers on their vehicles to distance themselves from Musk, sort of like smear lamb’s blood over your door to ward off death. But after President Donald Trump picked Musk as his special little unelected bureaucrat and his infamous nazi salute, Tesla’s get more than dirty looks — they get set on fire. 

So something tells me the public will like a tax specifically targeting Tesla. But the corporate lobbyists that testified at the Senate Ways & Means Committee last night — from conservative think-tank the Washington Policy Center, Washington Citizens Against Unfair Taxes, Rivian, and the pariah in question, Tesla — feel differently. 

Rivian lobbyist​​ Troy Nichols argued SB 5811 undermined the foundational principles of the ZEV program by punishing the very early action and overcompliance the program originally sought to reward. As Jeff Pack from Washington Citizens Against Unfair Taxes said to the committee, “you look pretty foolish. On one hand taxing the EVs you want us to buy, but then on the other hand, trying to get us to actually buy them. I just shake my head.” 

But opponents seem to believe the tax isn’t actually about incentivizing one behavior or even generating a bunch of revenue. Rather, the Democrats that control Olympia want an outlet for their political rage against Musk. 

President of the Washington Policy Center said the true intent behind the bill is to punish Tesla, “a company who did exactly what the legislature claimed it wanted — increased the sale of electric vehicles — but is now perceived as a political opponent.” 

The committee took no action on the bill last night and now it's off to executive session on what’s shaping up to be a busy Friday in Olympia.