State Tax Policy: First things first

Washington has a "complicated" tax structure. We'd use stronger words -- incoherent, perplexing, unfair -- but it's easier to show rather than tell. A state-owned university must pay sales tax on most of its purchases, even on products that advance its educational mission. It's the same for much of what the state buys to build highways; a sales tax is collected on the materials used. This is a loop that means state government essentially pays sales tax on money spent that is generated from the sales tax. Great logic, eh?

In that context: Consider the deal technology companies are seeking from the Legislature. A few companies would like sales tax breaks for server farms in rural parts of the state, where massive banks of computers are warehoused to store e-mails and other data. These farms will be gigantic consumers of our region's subsidized electricity.

We understand the competitive argument: Microsoft, Yahoo or any technology enterprise could build server farms anywhere (including Oregon, where there is no sales tax). That's a fair point, but one that argues for a comprehensive review of Washington's tax policy rather than databit by databit exemptions. If anything, the debate is proof that Washington lawmakers ought to take a time out and come up with a new tax structure that makes sense.

Tax reform, yes. But let's have the big picture debate before granting new exemptions that might not serve the public interest.