Washington state ranks 35th for economic and political freedom in 2024 report

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Washington state ranks 35th out of 50 states in the 2024 Index of Freedom report by Schweitzer Engineering Laboratories (SEL), which evaluates government efficiency, regulatory freedom, and energy resiliency. Based in Pullman, Washington, SEL specializes in power system protection and automation.

This year's report utilizes data from various sources, including the American Legislative Exchange Council and the U.S. Census Bureau. The ranking indicates a decline from 32nd place last year and 36th in 2022. Washington scored 38th in Government Efficiency, 46th in Regulatory Freedom, and 20th in Energy Resiliency.

The report notes that Washington's regulatory environment is complex and restrictive, affecting business growth. Although the state does not impose typical personal or corporate income taxes, it has a 7% capital gains tax and a gross receipts tax. The capital gains tax, passed in 2021, is under review through Initiative 2109, which seeks its repeal.

Despite these challenges, Washington benefits from an abundance of hydroelectric power, contributing to its energy resiliency. Economist Paul Turek acknowledged the report's partisan nature but highlighted its potential usefulness for businesses considering location decisions.

Turek emphasized that businesses must evaluate their priorities to make informed economic and political decisions, especially in the context of the upcoming presidential election.