Seattle approves 'head tax' on businesses to fight homelessness

Seattle approves 'head tax' on businesses to fight homelessness

It would raise an estimated $44.7 million a year and expire after five years, according to the Council. The tax will provide additional revenue.

Although opposition seems to have succeeded in reducing the tax burden, it did little to convince the council that the tax itself was unsound, as today's vote indicates.

Seattle City Council is expected to officially vote Monday on the controversial $500 per worker Seattle head tax proposal, an issue that has provoked strong reactions on both sides.

The tax plan applies to firms in the USA city who have an income of over $20 million and amounts to an extra 14 cents in tax per hour worked by each employee under the companies who are large enough to be eligible - around 500 in total. It will raise $48 million to pay for services combating the city's homelessness problem. He went on to say that the "city does not have a revenue problem - it has a spending efficiency problem". Despite this, the mayor of Mountain View, California has proposed a head tax similar to the one passed in Seattle, and San Jose, Sunnyvale, and Redwood City have all added them in recent years.

The original tax proposal was almost twice as high and would have generated close to $80 million.

Jeff Bezos-owned Amazon joined Starbucks in criticizing the tax proposal.

Of Seattle's largest employers - a group that includes Nintendo, Microsoft, and Expedia - two stand to be hit the hardest: Amazon and Starbucks. "Not just here at city hall, but all across this city", Durkan, said.

The vote on Seattle's "head tax" will take place tomorrow.

More news: Arizona Cardinals draftee Christian Kirk arrested at Phoenix Open

Meanwhile, Schoesler says state Attorney General Bob Ferguson has been "strangely silent" on the topic. "The results are getting worse every year", he said.

The city also pays $1.6 million to the Seattle Police Department Navigation Team and $1.3 million for Navigation Team management and clean-up contracts. Starbucks and Uwajimaya were among other businesses that weighed in against the original legislation.

Seattle declared a civil state of emergency over homelessness in late 2015.

Median rents have doubled since 2010, according to real estate firm Zillow, and the area has the third highest homeless population in the nation, according to USA government statistics. With 45,000 employees now in Seattle, the tech giant would have ended up paying around $12 million a year. People in the crowd held up signs: "Don't vote our jobs away" or "Tax the rich". Mayor Jenny Durkan had said she would veto the proposal for the higher amount.

The company expressed disappointment with the outcome.

In a statement, Drew Herdener, an Amazon vice president, said Amazon was "disappointed" in the vote and remains "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".

"The Council is completely oblivious to what it takes to keep job creators in our state", part of the statement reads.

Related Articles