Published: Tue, May 15, 2018
Finance | By Loren Pratt

Seattle approves business tax for homelessness

Seattle approves business tax for homelessness

The Seattle City Council voted 9-0 in support of a new "head tax" on the city's largest businesses as part of an effort to help the city's homeless, The Seattle Times reported. Construction workers chanted "no head tax" and disrupted a news conference she held last week on Amazon's campus.

Amazon has the backing of the Seattle Times editorial board, which has called the proposed tax a "symbolic "eat the rich" gesture", that it contends would harm workers.

Councilmember Kshama Sawant said Amazon was attempting to "blackmail" the city. Durkan said she would sign the alternate plan but was still not behind the proposal the committee passed.

The only companies affected by the new ordinance would be those generating $20 million or more of annual revenue in the city.

The local government is expected to raise $75 million dollars from the tax with Amazon expected to pay over at least $20 million of the total sum. Chicago ditched its head tax several years ago with Mayor Rahm Emanuel calling it a job killer.

On Friday, city council members approved a proposal to charge the large employers in the city $500-per-employee.

Durkan, many businesses such as Amazon and construction-worker unions opposed it, as did Council President Bruce Harrell, Councilmembers Sally Bagshaw, Debora Juarez and Rob Johnson and some voters critical of how City Hall has been spending money. "So you're either well-off and hungry or homeless and well fed".

Other unions, including the Service Employees International Union, supported the tax.

Another called a member of the City Council a communist (she's actually a socialist) and said she "seems to be getting paid by the residents of Seattle to throw temper tantrums".

A council committee could vote this week and the full council may take it up Monday. King County, which includes Seattle, recorded a record 169 homeless deaths previous year.

"The spending keeps going up and we're not seeing results".

Mayor Jenny Durkan said that Seattle now spends about $70 million in annual direct investments to programs that fight homelessness in her first State of the City address. The Seattle region had the third-highest number of homeless people in the US and saw 169 homeless deaths a year ago.

While criticized for being slow to contribute, Amazon in recent years donated two buildings on its campus to house the homeless. But now Philadelphia is shortlisted for Amazon's second headquarters. But the notion of the city council approving the reform which would raise taxes by $75 million annually is something that Amazon is not prepared to entertain which is why they have halted the construction plans and are willing to let go of the space they leased. That figure could quickly rise when the funding mechanism would transition to a payroll tax. Healthcare companies are exempt, as are non-profits. But city council members chose to approve a thinner version of that proposal.

He said he was anxious about the effect the larger tax would have had on jobs in part because of concern over how the money would be spent. So the city is restricted in how it can raise revenue, and now relies on sales and property taxes as well as a business and occupancy tax. From member station KUOW in Seattle, Carolyn Adolph reports.

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