Seattle approves 'head tax' on large businesses despite Amazon's opposition

Mayor Jenny Durkan attends the Washington Women in Trades job fair at Seattle Center on Friday

Mayor Jenny Durkan attends the Washington Women in Trades job fair at Seattle Center on Friday

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.

Representatives of businesses warned that the tax would drive employers out of town, while others speakers questioned whether Seattle's city government could be trusted to spend the additional tax revenue wisely.

The City Council's 9-0 vote, which followed a weekend of last-minute changes meant to gain support from Democratic Mayor Jenny Durkan, affirms a plan that aims at generating more money to address homelessness and housing affordability in the Pacific Northwest city.

Mayor Jenny Durkan, who expressed concern that the original proposal would lead to an economic backlash, said she would sign the new tax ordinance into law.

While supporters said the head tax was necessary to fund efforts to address a housing crisis and rising homelessness in the city, the measure was met with near-universal opposition from businesses, as well as the Seattle Metropolitan Chamber of Commerce.

At the beginning of May, Amazon reportedly told developers to halt construction on a 17-story office building until after the council votes on the head tax.


As a result of the scaled back head tax, Amazon would see its potential bill fall from an estimated $20 million a year to $12.4 million, given that it employs about 45,000 people in the Seattle area.

Boeing, Costco Wholesalers and Microsoft, which are each among Seattle's largest employers, declined to comment on the matter.

"This is the richest city in the state and in a state that has the most regressive tax system in the country", said council member Teresa Mosqueda, who supported a larger tax but called the plan "a down payment" to build housing the city needs.

The approval Monday brought a victory for Lisa Herbold and Lorena Gonzalez, the legislative architects on the plan, and, maybe, some time to finally rest after a weekend of negotiating. The number of homeless students in the city's public schools has tripled, to almost 4,300 last school year. The tax would end after five years with a review in the last year to determine whether or not it should continue. And, they made noises about looking at other cities for it's second corporate headquarters site and other operations as well.

We are disappointed by today's City Council decision to introduce a tax on jobs.

"I live in a little shed, but it's better than living in a tent or in a sleeping bag on the street", she said as she stood in line an hour before Monday's meeting began. "I don't understand why businesses think it's wrong to help". Those four opposed the amendment to lower the head tax to $250 per employee on Friday. The money will reportedly be used to combat Seattle's raging homeless problem, but critics are asking what's happened to the millions already spent on such programs over the last few years.

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