Seattle's Democrat Mayor Katie Wilson has expressed skepticism over a recent survey indicating that more than half of Washington state's business leaders are contemplating leaving the state due to the newly imposed millionaire's tax. In March, Washington state Democrats enacted a 9.9% income tax on households earning over $1 million annually. According to a survey released in May by the Association of Washington Business (AWB) and reported by the Olympian, 55% of business leaders are considering relocating their personal residence to another state—an increase of 11 percentage points from earlier this year when 44% expressed similar intentions.
Mayor Wilson's Response
Mayor Wilson dismissed the concerns as “overblown” during an interview with FOX 13 Seattle. “I still think that claims of a large exodus of rich people due to our statewide millionaire tax that the legislature passed this year are overblown,” she said, laughing. Wilson asserted that she has built strong relationships with the city's business community since taking office on January 1. “When I think about the last five months and the things that I and my administration have done to build bridges with the business community, the narrative that was spun around those things is very, very out of step with the reality,” she stated.
Business Support for Homeless Initiatives
Wilson highlighted that major Washington-based companies like Starbucks, T-Mobile, and Microsoft have supported her controversial 90-unit tiny house village project for temporary homeless housing. “This narrative that it’s like Seattle socialist mayor versus Starbucks, like well, then why are they donating a million dollars to our shelter site?” she questioned.
AWB Survey Findings
The AWB survey revealed that the number of employers looking to relocate their business out of Washington rose to 24%, up from 17% in the previous quarter and nearly triple the figure from AWB's winter 2025 survey 16 months earlier. Additionally, 55% of respondents are considering moving their personal residence to another state, up from 44% the prior quarter. In Spokane County, near the Idaho border, 67% of respondents are contemplating such a move.
Among those exploring a business move, 35% are in the early stages, 28% are actively searching for locations, and 18% are developing a relocation plan. Six percent have already relocated part of their business, and 3% are in the process. For personal residence moves, 59% are looking at real estate in another state, 44% are consulting with a CPA or tax professional, and 18% already own property elsewhere.
Declining Business Confidence
The survey indicates a broader lack of confidence in Washington's economy. Sentiment has worsened across nearly every indicator over the past 16 months, following lawmakers' passage of a record $9.4 billion in new taxes in 2025 and the subsequent income tax targeting millionaires, which also affects small- and medium-sized businesses structured as pass-through entities.
AWB President Kris Johnson warned, “It’s tempting for lawmakers to dismiss this kind of report and to suggest that businesses won’t really leave, but that would be a mistake. We are already seeing evidence of employers moving operations or moving their personal residence to other states, and we expect to see more in the coming years as plans that are being made right now are put into motion.” He added that business owners are moving taxable assets out of Washington, planning fewer hires, growing more worried about a recession, and are more likely to expand in other states than in Washington.
Top Business Concerns
The cost of health care ranked second among top business concerns (65%), followed by government regulations (58%). The cost of fuel, a new survey addition, came in fourth with 53% flagging it. Concern about inflation ticked up to 51% after falling to 40% last quarter, ranking fifth. Concern about tariffs continued to decline to 28%, though 56% of respondents still report negative impacts from tariffs.
