Seattle City Council approves controversial head tax on large businesses

15 May, 2018, 22:35 | Author: Brooke Harris
  • Protesters attend the Seattle City Council finance committee meeting Friday May 11. The committee voted 5-4 to reject Mayor Jenny Durkan’s proposal of a more modest tax on large employers to address the city’s homelessness crisis.(Steve Ringman  The

The Seattle City Council unanimously passed a tax on large employers Monday that will aid the city's homeless residents - but not before slashing the proposal almost in half over opposition from Amazon, which is headquartered in Seattle, and a veto threat from Mayor Jenny Durkan.

Two of Seattle's top employers are taking the gloves off and pulling no punches in the wake of a newly passed tax on companies making more than $20 million a year in the city.

However, the version of the tax that the City Council agreed to on Monday will be far less onerous than the draft that led Amazon to suspend construction on a new office tower in a not-so-subtle threat over providing further employment in Seattle.

Amazon, Starbucks, and business groups sharply criticized the council's decision after Monday's vote.

A new tax approved by the Seattle City Council has triggered a fierce war of words between the liberal city and its behemoth corporations usually known for their progressive outlook. But she said she was proud the plan for a new tax had "evolved more towards progressivity" and would do things like protect the city's small businesses.

Amazon was the main target of the campaign for establishing an employee head tax in Seattle. It accused the city of spending without accountability while ignoring that hundreds of children sleep outside.

The city has the third-largest number of homeless people anywhere in the USA, with 169 people dying out on the streets in the past year alone.

Much of the revenue generated from the tax will be used to build new low-income housing units, as Seattle is in the midst of a housing and homelessness crisis.

The company lobbied against both tax proposals and Drew Herdener, an Amazon vice president, said the retail giant was disappointed in Monday's vote, according to The New York Times. The initial proposal called for the tax to be $500 per employee, but the city's mayor had threatened to veto it, the Seattle Times reported.

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"The city does not have a revenue problem - it has a spending efficiency problem", he said. The Seattle region had the third-highest number of homeless people in the United States and saw 169 homeless deaths previous year. There were 11,600 homeless people living in the county past year, according to The Seattle Times. The tax will provide additional revenue.

For her part, Durkan said the limited tax would "address our homelessness crisis without jeopardizing critical jobs".

Supporters of the tax say that large companies such as Starbucks and Amazon have contributed to Seattle's homelessness by driving up rent and home prices.

The unanimous vote in favor of the amended tax proposal occurred at a raucous public meeting at which advocates for the homeless and affordable housing - some holding placards saying "Tax Amazon" - argued in favor of a stiffer tax on the company and other businesses.

"The City of Seattle has an obligation to take care of those people who are suffering on our city's streets", Gonzalez said prior to Monday's vote.

González said she had hoped to be voting "on a different package" with more money, but "I'm glad to be able to finally move this forward".

Herdener then turned the tables, suggesting the people holding the city's purse strings are the problem.

Get the Monitor stories you care about delivered to your inbox. Those on the smaller end of that scale say they fear they will feel the brunt of it. "I'm confused about why the city of Seattle is fostering an adversarial relationship with businesses in this city".

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