Tech Entrepreneur Slams Washington’s “Millionaire Tax” as an Unconstitutional Threat Driving Business Out of State

Prominent Seattle technology founder Jesse Proudman has voiced sharp criticism against Washington State’s newly passed 9.9% income tax on high earners. Proudman warns that the policy—which he deems a major policy error and legally invalid under the state’s constitution—is already triggering a notable flight of investment and talent from the Pacific Northwest’s startup ecosystem.

Key Highlights:

• The Entrepreneur’s Ultimatum: Proudman, the founder and CTO of privacy-focused generative AI platform Venice.ai and a lifelong Washington resident, announced he is relocating his life and business operations to Austin, Texas. Having launched three companies in the state over nearly three decades, he stated that Washington has shifted from a “startup sanctuary” to an environment where businesses are being “villainized.”
• The Legislative Battle: The controversy stems from Senate Bill 6346, passed by state Democrats, which imposes a 9.9% tax on personal incomes exceeding $1 million. While proponents market it as a targeted “millionaire’s tax,” opponents argue it effectively creates a state income tax in modern Washington history for the first time, defying a long tradition of having no personal income tax.
• The Mobility Threat: Proudman argues that the tax targets a highly mobile segment of the population that can easily relocate to tax-friendly hubs like Austin, Miami, or Las Vegas. He warns that when wealthy residents and startup founders depart, the resulting deficit will inevitably force the state to expand the income tax to cover middle-class residents.
• Bad Timing for Tech: The tax comes at a volatile moment for the regional economy. The Puget Sound region is navigating tech sector disruption, localized corporate layoffs, and structural transformations driven by artificial intelligence. Critics argue that penalizing high-earning innovators right now damages Washington’s economic foundation.
• Broader Business Pushback: Business anxiety is widespread. According to a survey by the Association of Washington Business, 44% of local business leaders are mulling moving their residences out of the state, pointing to the tax climate as their primary grievance. Proudman is currently collaborating with the political committee Let’s Go Washington to gather signatures to push for a repeal of the measure. +1