Published: Tue, May 15, 2018
Finance | By Claude Patterson

Seattle Council OKs Lower $50M Annual Head Tax On Big Biz

Seattle Council OKs Lower $50M Annual Head Tax On Big Biz

A watered-down version of the tax, which will charge the city's largest employees $275-per-worker annually, is now expected to be enacted by Seattle's mayor, Jenny Durkan. While the $275 figure is nearly half the originally proposed tax of $500 per employee, it still means Amazon will face an extra yearly tax bill of $11 million in the city.

Most money raised would build 1,780 affordable housing units over five years.

Amazon's Herdener said the company will resume construction planning on the office tower it had paused. That original compromise was voted down Friday. Those businesses, such as Amazon, would pay 26 cents per hour, per employee working in the city, which equates to about $500 per worker.

Almost 600 employers with gross revenues of more than $20 million - including Starbucks and Amazon - will be expected to pay the charge in Seattle from next year onwards.

Sawant named and criticized her colleagues who opposed the original $500 tax and suggested they are putting the interest of businesses over the homeless.

'We must stand up against Amazon's bullying! "If we had a weaker movement, we could have won less or even nothing".

Amazon and Seattle-based coffeehouse chain Starbucks did not immediately respond to FOX Business's request for comment on the city council's decision. Amazon's plans in Seattle after today's vote are not clear.

Councilwoman Sawant talks a lot about union labor, but in this case, many rank-and-file union members are against the head tax because their jobs (building the new skyscrapers Amazon will inhabit) are dependent on the company staying in the city. "We'll be back for more!"

The city's homeless population is growing, behind only NY and Los Angeles. So far, mayors in other cities competing for HQ2, as the project is sometimes called, have taken a wait-and-see approach.

They instead convened a task force to study the city's homelessness needs and to recommend new progressive revenue sources.

John Bufford, 47, of Tacoma, an elected union representative for International Union Painters and Allied Trades, said some members of the council seemed to be more interested in personally targeting Amazon chief executive Jeffrey P. Bezos rather than addressing the problem.

As a result of the new request for proposals process implemented last year, the contracts last a year, but the city says it assesses the service providers quarterly to determine whether the providers are meeting performance targets.

Meanwhile, median cost of a single-family house in Seattle rose 110 percent since Amazon opened its headquarters in 2010, according to The Seattle Times. A new report concluded that it would require about $400 million a year, conservatively, to solve the homelessness crisis in King County.

He noted that Seattle revenue has grown dramatically and that the city "does not have a revenue problem - it has a spending efficiency problem". United Way of King County spent around $6.5 million in 2017.

Head tax supporters marched on Amazon Saturday, led by Sawant and the Affordable Housing Alliance.

Not everyone, however, was supportive of the marchers, with one person telling KOMO News that policy changes affecting Amazon negatively could have a devastating outcome.

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