Monday, 28 May, 2018

Seattle City Council scales back tax to aid homeless amid Amazon opposition

Seattle City Councilmembers debate dueling head-tax proposals on Friday May 11 Seattle approves tax on companies like Starbucks, Amazon to fight homelessness
Scott Davis | 15 May, 2018, 22:36

Starbucks was scathing Tuesday in its criticism of the Seattle City Council, which on Monday unanimously passed a controversial tax on big businesses to help fund affordable housing and fight homelessness. Top-grossing Seattle businesses will be taxed $275 per employee, per hour worked - down from $500 previously - each year for five years.

The lower tax was the result of feverish negotiations over the weekend between members of the City Council and Seattle's mayor, Jenny Durkan, who had opposed the council's earlier tax proposal.

Republican State Senator Mark Schoesler says he will be taking action against the tax, introducing legislation that says it is an unauthorized tax unless approved by legislature, which "reinforces current law".

Along with the tax Monday, the council approved a non-binding resolution that calls for spending 66 percent of the new money on affordable housing, 32 percent on emergency shelter, trash pickup, raises for service workers and other needs and 2 percent on administration.

The Downtown Seattle Association said in a statement it appreciated Durkan's efforts to modify the original head tax proposal.

Hederner, the Amazon vice president, said sharp increases in the city of Seattle's revenues have outpaced the population growth of the city during the same period.




Marilyn Strickland, president and CEO of the Seattle Metro Chamber, voiced business leaders' opposition to the tax. The mayor had publicly hinted that she would veto the original tax proposal because of the risks she said it posed to the local economy. The tax will now generate $47 million a year, and it will run for five years, rather than turning into a payroll tax after a two-year run. In Denver, there is a $50-per-year tax for a full-time employee, while Chicago Mayor Rahm Emanuel scrapped the Windy City's tax after calling it a job killer. She said she ultimately supported the compromise because it creates "a significant new revenue stream" to build more affordable housing. "We are highly uncertain whether the city council's anti-business positions or its spending inefficiency will change for the better", Herdener said. The new tax will take effect in 2019. The Seattle region had the third-highest number of homeless people in the United States and saw 169 homeless deaths previous year.

Before the vote, she said the city "has an obligation to take care of the people who are surviving and suffering on our city streets". The Seattle region had the third-highest number of homeless people in the US and saw 169 homeless deaths in 2017.

The Associated Press reports that the Seattle region had the third-highest number of homeless people in the USA, despite the city spending $68 million on combating homelessness previous year.

"Tax Amazon" was the battle cry for supporters of the measure, claiming the Seattle-based behemoth that employs thousands in the city is not paying its fair share.

"We remain very apprehensive about the future created by the council's hostile approach and rhetoric toward larger businesses, which forces us to question our growth here", Herdener said.

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