Tech founder Jesse Proudman is leaving Washington and joining a growing wave of business departures after the state passed a high-profile “millionaire tax.” The move, and Proudman’s role with the Let’s Go Washington committee, has become a focal point in a broader debate about whether the new levy will push entrepreneurs, jobs, and families out of the Evergreen State. The dispute touches lawmakers like Gov. Bob Ferguson and State Sen. Jamie Pedersen, and is drawing attention from groups such as the Association of Washington Business.
Entrepreneur Jesse Proudman says he launched multiple companies in Washington and once saw the state as a “startup sanctuary.” He told reporters the climate has shifted, arguing “The business climate when I started my first company was very entrepreneurial-friendly, and the startup community was looked upon as a contributing member of the city. Over the last number of years, that has changed dramatically.” His comments reflect a larger frustration among founders who feel targeted by new tax policies.
The new law, pushed through the Democratic-controlled legislature in 2026 and signed by Gov. Bob Ferguson, levies a 9.9% tax on income above $1 million and is scheduled to take effect Jan. 1, 2028. The first payments would be due in 2029, but critics say the mere announcement has already altered decision-making for executives and families weighing whether to stay. For Proudman, the practical response has been relocation planning.
Let’s Go Washington, the political committee working to overturn the law, is mounting a signature drive to put a repeal on the November ballot. “We have until July 2nd to gather about 325,000 signatures to put this on the November ballot,” said Hallie Herzberg, Director of Communications for Let’s Go Washington. Herzberg argues that voters deserve a direct say and that the policy is already prompting departures of employers and households.
Supporters of the tax, including Senate Majority Leader Jamie Pedersen, insist fears of mass exits are exaggerated. “The reality is the millionaire tax is not likely to result in businesses leaving,” Pedersen told a local affiliate after the bill’s signing. He also said there is “no evidence” that high earners will migrate to lower-tax states like Florida or Texas, a claim that opponents dispute with fresh survey data.
Research from the Association of Washington Business paints a different picture: a sizeable share of business leaders are considering moving their personal residences, and companies are more likely to look outside the state for expansion. The AWB data showed 44% of business leaders are contemplating leaving, and businesses now report being more than twice as likely to expand outside Washington than within it. Those shifts, if sustained, could erode the tax base that funds state services.
For founders like Proudman, the tax is more than a line item; it changes how investors, employees, and founders weigh a state’s competitiveness. “It’s no longer a friendly place to conduct business,” he said, adding that “Startup companies are being villainized. With the passing of this tax, we have looked at alternative places to move, and we’ll probably end up in Austin.” Those words capture the urgency among entrepreneurs who prize predictable, entrepreneur-friendly policy.
Washington’s tax landscape has already been altered by a 2023 state Supreme Court decision that upheld a 7% capital gains tax, a move critics say opened the door for broader income levies. That ruling unsettled long-standing assumptions about Washington’s status among the few states without a personal income tax, and opponents argue the new law risks violating constitutional uniformity rules. Proponents counter that funding priorities justify the change, but the debate is now very much a live political fight.
Proudman warns the so-called “millionaire’s tax” could eventually reach middle-class residents as the highly mobile wealthy leave and the taxable base shrinks. “They are targeting a very highly mobile cohort of the population,” he said, and he warned, “When those folks leave, this will become a tax on everybody. The voters are unwittingly creating an incredibly worse tax situation for themselves. Washington is already the 45th worst state from a tax point of view. This is a constitutionally illegal tax that ultimately will apply to everyone.” Those are stark words aimed at persuading voters to reconsider.
As signature collectors race toward the July 2 deadline, the fight over the tax will play out in campaigns and in the choices of companies weighing relocation. Proudman has chosen Austin for his next chapter and says the move is about preserving growth and opportunity. Sen. Pedersen’s office did not respond to requests for further comment, leaving the political argument to play out in public and at the ballot box.
