The Seattle City Council voted 9-0 to impose a new tax on large employers to raise nearly $50 million in funding for affordable housing construction and homeless services. "The city does not have a revenue problem - it has a spending efficiency problem".
The ordinance will impose a $275-per-employee tax on for-profit companies in Seattle that make $20 million or more. The amendment is the result of a compromise reached between Mayor Jenny Durkan and several sponsors of the originally proposed tax over the weekend.
"The City of Seattle has an obligation to take care of those people who are suffering on our city's streets", Gonzalez said prior to Monday's vote.
City coffers are expected to receive around $48million per year under the new proposal, down from $80million under the original.
Head taxes are extremely rare in the USA and the ones in place are a fraction of Seattle's proposal.
Marilyn Strickland, president and CEO of the Seattle Metro Chamber, voiced business leaders' opposition to the tax.
The original proposal would've charged around $500 per full-time employee instead of $275, which would've brought up to $86 million a year into city coffers, per new estimates; Durkan had said she would've vetoed that measure. With more than 40,000 employees and counting, Amazon is at the center of the conversation and the explicit target of Sawant, who has called the proposal "Tax Amazon Legislation".
"A tax on jobs at any level is bad economic policy and will negatively impact Seattle's economy and city tax revenues", Downtown Seattle Association spokesperson James Sido wrote in a statement.
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The tax that passed Monday will raise close to $50 million annually to fight the homelessness crisis. The law would affect about 3 percent of business in the city, according to the council.
Following the change, Amazon has said it will now continue construction on the new building but is still considering whether to lease space in a second tower.
A new tax approved by the Seattle City Council has triggered a fierce war of words between the liberal city and its behemoth corporations usually known for their progressive outlook. The Seattle region had the third-highest number of homeless people in the United States and saw 169 homeless deaths previous year.
"This was a tough debate in our city", she said. A new report concluded that it would require about $400 million a year, conservatively, to solve the homelessness crisis in King County.
Herdener then turned the tables, suggesting the people holding the city's purse strings are the problem.
Criticism from Starbucks comes on the heels of a statement Amazon issued saying it is "very apprehensive" about its future in Seattle because of the city's "hostile approach and rhetoric toward larger businesses".
Even though the company made a decision to resume one of its building projects, Drew Herdener, an Amazon vice president, said in a statement, "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".