Tuesday, 14 August, 2018

Seattle tax showdown with Amazon coming to a head

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 Seattle tax showdown with Amazon coming to a head
Russell Knight | 15 May, 2018, 12:45

Seattle's city council on Monday approved a new tax for the city's biggest companies, including Amazon.com Inc, to combat a housing crisis attributed in part to a local economic boom that has driven up real estate costs at the expense of the working class.

A divided Seattle City Council is expected to vote Monday on a proposal to tax large businesses to fight homelessness.

The tax will expire after five years, requiring the council to vote on whether to renew it on 2023. About 60 percent of the revenue will go to creating deeply affordable housing, and about 40 percent for homeless services, with an emphasis on programs that get people into emergency and temporary housing.

About 3 percent of Seattle businesses will be affected and the tax will raise about $47 million per year, according to the council.

The legislation was born out of Seattle's "Progressive Revenue Task Force."

Seattle City Council members on Monday narrowly defeated a scaled-back version of the proposed tax supported by Mayor Jenny Durkan.

The tax passed by a veto-proof unanimous vote. Sawant was the only councilmember to vote against cutting the per-employee cost from $500 to $275 at Monday's meeting.

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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.

"While Amazon didn't single-handedly cause this problem, they have contributed to the growing income inequality, displacement and housing affordability issues facing our city", they said in a statement to The Seattle times earlier this month. There's no income or capital gains tax in Washington state, and Amazon paid no federal taxes on its income for previous year.

A larger tax had been proposed and passed at committee stage on Friday by a close vote to charge $500 per full-time worker each year to raise about $75 million.

"We could not find the votes we needed", he told The Seattle Times.

"When you work minimum wage at $15 an hour, you end up spending 90 percent or more of it on rent and the rest of it in bills", said Alexander Finch, 27, who identified himself as homeless and living in one of the city's tent communities.

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".

John Boufford with the International Union of Painters and Allied Trades said he didn't understand rhetoric against Amazon, which he noted provides good jobs for thousands of people. But its most vocal critic may have been Amazon, which threatened to stop construction on new facilities in the city and put 7,000 jobs on hold over the tax proposal. "It seems like some of the council members, mainly Mrs. Sawant, have gone on the offense against Amazon in particular".

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