Washington state lawmakers begin a 60-day session Jan. 12, in which a fiscal reckoning, flood recovery, and their own reelections loom large.

Federal tax officials have set medical and military moving mileage rates slightly lower while charitable mileage rates remain unchanged for 2026. 

“We are facing falling revenue, rising costs, and budget cuts and chaos coming from the Trump administration,” Gov. Bob Ferguson said. “I’m providing a road map for the Legislature. This is, of course, the first step in a conversation about how best to balance our budget.” 

Some legislative Democrats are eyeing a 9.9% “millionaires tax” on adjusted annual gross income over $1 million. Ferguson endorsed this version of the proposal. Less than 0.5% of Washingtonians would be subject to the tax, and it’s expected to raise $3 billion per year. 

The next legislative session is fast approaching and some state lawmakers are wasting no time in signaling their intent to either fully remove or limit the impacts of the slew of new state taxes approved in the 2025 legislative session. 

Washington Gov. Bob Ferguson unveiled a plan Dec. 19 to steer $3 billion into preserving the state’s roads and bridges and building three new ferries over the next decade.

The governor also signed an executive order to get the ball rolling on establishing a new cabinet-level Department of Housing. 

New federal legislation introduced by U.S. Rep. Dan Newhouse would expand tax incentives for investments in new nuclear energy projects in the U.S., which the Washington Republican said puts the energy source on parity with other sources.