SEVERE WX : Dense Fog Advisory View Alerts
CLOSINGS: View Closings

Seattle passes a smaller version of the 'Amazon tax'

A controversial proposal that will tax big businesses in Seattle to alleviate the city's homelessness and affordable ...

Posted: May 15, 2018 4:21 PM
Updated: May 15, 2018 4:21 PM

A controversial proposal that will tax big businesses in Seattle to alleviate the city's homelessness and affordable housing problems was approved Monday.

The Seattle City Council passed it unanimously in a 9-0 vote.

The final package, however, is almost half the size of the original proposal, which never garnered a veto-proof majority on the council. It was publicly opposed by Amazon -- the city's largest private sector employer -- and 131 other businesses.

The newly passed ordinance, which takes effect in January 2019, will impose a "head tax" on the city's highest grossing businesses. The tax will amount to $275 a year per full-time employee in Seattle. It would raise roughly $47 million a year on average and expire after five years, according to the Council.

That's down from the $75 million a year the original proposal would have generated by imposing a $540 head tax per employee for the next few years, after which it would be converted to a 0.7% payroll tax.

Related: For Amazon HQ2 hopefuls, Seattle serves as a cautionary tale

The only companies affected by the new ordinance would be those generating $20 million or more of annual revenue in the city. That's roughly 3% of businesses in Seattle, or 585 employers, according to the Council's estimates.

Roughly 60% of the revenue raised would go to building affordable housing, and 40% will be put toward emergency services for the homeless, Councilmember Lorena Gonz-lez said in the Council's public meeting Monday.

Seattle Mayor Jenny Durkan, who threatened to veto the original $540 head tax out of concern that it could cost the city good jobs, said Monday evening she would sign the new compromise deal into law.

"This legislation will help us address our homelessness crisis without jeopardizing critical jobs," Durkan said in a statement.

She promised "urgent action to move people off our streets and into safer places and to clean up garbage, needles and waste from our parks and communities" while also creating "more accountability and transparency with taxpayer dollars."

Seattle does not have an income tax because it's prohibited under Washington state law. So the city is restricted in how it can raise revenue, and currently relies on sales and property taxes as well as a business and occupancy tax.

In recent years the city has experienced an economic boom, but in tandem with that also an acute affordable housing and homelessness problem.

"People are dying on the doorsteps of prosperity," Councilmember Teresa Mosqueda said in the meeting.

Amazon is still not pleased

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.

Nevertheless, the company is "disappointed by today's City Council decision to introduce a tax on jobs," Amazon Vice President Drew Herdener said in a statement.

Herdener noted that the company, which has embarked on numerous efforts to help alleviate the homeless problem, has resumed its construction on a new 17-floor office tower, which it had paused ahead of the vote.

But, he added, "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."

Correction: An earlier version of this story stated the tax would raise $44.7 million a year, according to the Council. The Council's estimate is $47 million a year.

Minnesota Coronavirus Cases

Data is updated nightly.

Cases: 276500

Reported Deaths: 3321
CountyCasesDeaths
Hennepin590031089
Ramsey24988472
Anoka19724213
Dakota19215176
Washington12538106
Stearns1226689
Scott753854
St. Louis740897
Wright663436
Olmsted610130
Sherburne512539
Clay445155
Carver409712
Blue Earth373511
Rice361431
Kandiyohi348215
Crow Wing316130
Nobles296028
Chisago28398
Otter Tail266615
Benton261940
Winona246128
Mower236722
Polk228621
Douglas219829
Morrison211621
Lyon193711
McLeod18879
Beltrami184615
Goodhue177626
Becker17559
Itasca168924
Steele16756
Todd165312
Isanti165015
Carlton153610
Nicollet146523
Freeborn13935
Mille Lacs132830
Le Sueur13219
Waseca129710
Cass12018
Pine11926
Brown117510
Meeker10797
Roseau9923
Martin98220
Hubbard97022
Wabasha9121
Dodge7850
Redwood78018
Watonwan7754
Chippewa7697
Sibley7094
Renville70818
Cottonwood7060
Wadena7006
Aitkin68923
Pipestone67018
Rock6439
Houston6152
Fillmore6050
Yellow Medicine56611
Pennington5356
Kanabec52911
Murray5283
Swift4976
Pope4820
Faribault4750
Stevens4442
Clearwater4356
Marshall4277
Jackson4091
Lake3584
Unassigned34356
Koochiching3325
Wilkin3275
Lac qui Parle3203
Lincoln3141
Norman3096
Big Stone2771
Mahnomen2494
Grant2346
Red Lake1903
Kittson1856
Traverse1330
Lake of the Woods871
Cook580

Iowa Coronavirus Cases

Data is updated nightly.

Cases: 213603

Reported Deaths: 2193
CountyCasesDeaths
Polk31707324
Linn13442161
Scott1040375
Black Hawk10393127
Woodbury9932114
Johnson911635
Dubuque879290
Story647619
Dallas602856
Pottawattamie585166
Sioux351925
Webster335930
Marshall332942
Cerro Gordo326541
Clinton307737
Buena Vista291114
Muscatine270366
Des Moines270116
Plymouth259537
Warren258510
Wapello242871
Jones222212
Jasper206639
Marion194418
Carroll190920
Lee190315
Bremer182612
Henry17087
Crawford170615
Benton160315
Tama146340
Jackson13758
Delaware136221
Washington131313
Boone128811
Dickinson127510
Mahaska121327
Wright11625
Buchanan11009
Page10834
Hardin107510
Clay10624
Clayton10234
Harrison102328
Hamilton10157
Cedar101413
Calhoun10047
Mills9886
Fayette9768
Floyd96914
Lyon9668
Kossuth9464
Poweshiek93712
Butler9134
Winneshiek90310
Iowa88011
Winnebago87523
Louisa81316
Hancock8067
Grundy79710
Chickasaw7893
Sac7817
Cherokee7624
Cass75419
Appanoose7426
Shelby7265
Allamakee72411
Mitchell7184
Union7096
Guthrie70815
Emmet70623
Franklin68419
Humboldt6645
Madison6474
Jefferson6351
Palo Alto6064
Unassigned5950
Keokuk5397
Pocahontas5192
Howard5069
Greene4980
Osceola4941
Clarke4614
Davis4405
Ida43910
Montgomery43210
Taylor4312
Monroe42912
Adair4157
Monona3932
Fremont3463
Van Buren3364
Worth3360
Lucas3076
Decatur3000
Wayne2876
Audubon2831
Ringgold1892
Adams1551
Rochester
Overcast
32° wxIcon
Hi: 34° Lo: 31°
Feels Like: 27°
Mason City
Overcast
36° wxIcon
Hi: 36° Lo: 32°
Feels Like: 30°
Albert Lea
36° wxIcon
Hi: 36° Lo: 32°
Feels Like: 32°
Austin
34° wxIcon
Hi: 36° Lo: 32°
Feels Like: 29°
Charles City
Overcast
34° wxIcon
Hi: 37° Lo: 32°
Feels Like: 30°
Dense Fog Expected Through Wednesday Morning
KIMT Radar
KIMT Eye in the sky

Community Events