Why is Washington a "Donor State"?

Washington consistently ranks as a top donor state. In 2024, Washington residents sent roughly $7,139 more per person to the federal government than they got back in services or funding.

The main reasons why:

• High Incomes: Washington has many high-earning workers (Tech, Aerospace, etc.). Because the U.S. has a progressive tax system, these people pay a higher percentage in taxes.7

• Strong Private Sector: Our economy is driven by private companies rather than huge federal facilities or massive military installations (compared to states like Virginia or Alabama).

• Lower Dependency: Washington has a relatively healthy economy with fewer people relying on certain federal "safety net" programs compared to lower-income states.

Key Stats (Averages)

State Type

Return on $1 Tax Paid

What It Means

Donor State (WA)

~$0.70 – $0.85

We send $1.00, but only get about 80 cents back.

Recipient State

$1.50 – $2.00+

They send $1.00, but get double back in federal aid.

Bottom Line: As a donor state, Washington’s tax dollars are frequently used to fund infrastructure, healthcare, and social programs in other parts of the country.

Negatives of Being a Donor State

A donor state (like Washington, which often ranks among the top per-capita contributors) pays more in federal taxes than it receives in federal spending. This status stems from high incomes and a progressive tax system, but it comes with several perceived drawbacks:

• Net Financial Outflow and Subsidization of Other States — Residents and businesses effectively subsidize services, infrastructure, and programs in recipient states (often lower-income or military-heavy ones like New Mexico or Virginia). For example, Washington's high per-capita contributions (e.g., over $7,000 per person in recent years) mean billions flow out annually to support higher federal returns elsewhere, reducing local reinvestment potential.

• Reduced Federal Funding for Local Needs — Donor states qualify for less need-based aid (e.g., Medicaid expansions, SNAP, or poverty-related grants) due to higher average incomes and economic strength. This can strain state budgets for services like education, healthcare, or infrastructure, forcing higher local taxes or cuts despite strong tax contributions federally.

• Perceived Unfairness and Political Resentment — Many view the system as inequitable, with wealthy (often blue-leaning) states funding poorer (often red-leaning) ones, fueling debates over "makers vs. takers." Politicians in donor states sometimes argue it disadvantages their residents, who get lower "return on tax dollars" (e.g., Washington often receives ~50-75 cents per dollar paid).

• Vulnerability to Federal Policy Changes — Threats to withhold funds (e.g., over policy disputes) hit harder, as donor states rely less on federal inflows. Changes in tax deductions (like the 2017 SALT cap) can exacerbate burdens in high-tax donor states.

Overall, while donor status reflects economic success (high GDP, incomes, and growth), the main negatives center on fiscal imbalance and the sense that local taxpayers fund more nationally than they get back locally. These concerns are common in states like Washington, California, and New Jersey, per analyses from USAFacts, Rockefeller Institute, and others.