Early results show I-1098 down 65-34

Washington voters have decided that they don't want to tax the rich in order to raise funds for education. Initiative 1098, which would have imposed a state income tax on individuals making more than $200,000, was defeated Tuesday night, according to early returns from the Washington State Secretary of State's office.

The measure was going down 65-34 percent. As of 9:08 p.m, 907,646 people had voted against the proposed state income tax while 479,659 were supporting it. In fact, the measure was losing in every county in the state -- a resounding defeat for a measure which polarized parts of the Seattle tech community. [Post updated with comments from Matt McIlwain and the latest results].

Microsoft co-founder Bill Gates and his father supported the measure, as did venture capitalist Nick Hanauer.

However, a number of prominent high-tech business leaders - -including Microsoft's Steve Ballmer, Amazon.com's Jeff Bezos and Madrona's Matt McIlwain -- argued that the measure would hurt the state's competitiveness. Opponents also argued that the tax eventually would be passed on to all citizens.

This marks the seventh time that voters have rejected a state income tax, according to the P-I. Washington remains one of seven states -- along with Florida, Nevada, Texas, Alaska, Wyoming and South Dakota -- without an income tax.

"Voters have spoken loud and clear: Washingtonians do not want a state income tax," Scott Stanzel, Defeat 1098 campaign manager, said in a statement to the P-I. "Citizens determined I-1098 was simply the first step toward establishing an income tax on all Washingtonians."

It's interesting how the actual results tracked so closely with last week's TechFlash poll. That poll, with more than 1,200 votes cast, was showing a 62-36 percent split.

UPDATE: Venture capitalist Matt McIlwain, a fierce opponent of the measure said he was pleased that "non-partisan Defeat 1098 coalation" prevailed.

" The more citizens learned about 1098, the more they realized it was the wrong policy proposal for our state," McIlwain told TechFlash. "Now that the state income tax is defeated, I look forward to working with others, especially those in the innovation economy who got involved this year, to positively reform education and other important policy areas in Washington."

Meanwhile, here are the latest vote totals as of 7:50 a.m. Wednesday moring. I-1098 was going down, 65-34 percent. 940,970 people had voted against the measure, while 493,762 supported it.

And here are some other comments from opponents of the tax measure.

Matt McIlwain: "The rejection of the I-1098 income tax is great news for job creation and economic growth in Washington. By defeating this income tax, we retain an important competitive advantage for recruiting people, companies and capital to our state."

Steve Mullin, president of the Washington Roundtable: "We may never know how many employers chose not to hire additional workers or even move operations to our state because of the uncertainty this income tax proposal placed on their ability to plan. With the strong signal sent tonight, it is time for our state's leaders to pull together, restructure state government and take the steps necessary to rebuild our economy."

John Giese, campaign consultant for Defeat 1098: "In overwhelming fashion, voters sent a clear message that they don't want an income tax. Washingtonians want legislators to make tough spending priority decisions, not raise taxes."

More from the election: Another Microsoft vet loses U.S. House bid in company's backyard