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Seattle backs 'head tax' on large companies like Amazon to help homeless

Seattle backs 'head tax' on large companies like Amazon to help homeless

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 new tax will take effect in 2019.

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Proponents say people are dying on the streets, and, while city-funded programmes found homes for 3,400 people a year ago, the problem deepens.

Judging from council members' past positions and their comments Friday (see video below), the most likely "swing vote" when the decision comes down to passing something or doing nothing appears to be council member Rob Johnson, who seemed more tentative in his position than either Debora Juarez ("If we tax jobs to build houses and the jobs leave because of the tax, then no houses get built") or Sally Bagshaw, who said virtually nothing at Friday's meeting but is typically not the first council member to make dramatic vote switches.

Amazon, the city's largest employer, had led private-sector opposition to the plan, saying it was freezing expansion planning for Seattle pending the outcome of Monday's action.

"There is no way this tax will be a burden on big businesses in Seattle", Sawant told The Seattle Times.

Democratic socialist Councilor Kshama Sawant was the sole vote against the amendment to reduce the tax from $500 to $275 per employee.

"I think we have to convince the public that we're using [funds] wisely and strategically, and I think we've failed in that regard as a city", said Council President Bruce Harrell during Monday's meeting.

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Outside of Seattle, King County's 2018 budget for homelessness spending was $66.9 million, which includes funding for emergency shelter, prevention, supportive housing, rapid re-housing, transitional housing, and other homeless housing programs and supportive services.

The city council backed a compromise plan that will charge large businesses about 275 U.S. dollars per full-time worker each year less than the 500 United States dollars per worker initially proposed.

The homelessness report commissioned by the local Chamber of Commerce, which was written by McKinsey and Company, said that local governments need to be spending between $164 and $214 million more to fulfill the region's homelessness needs. "The results are getting worse every year", he said. King County, which includes Seattle, recorded a record 169 homeless deaths previous year.

Underlying all of this is the fact that Seattle really does have a serious problem with homelessness, one that is driving even some long-time residents away from the city. This revenue increase far outpaces the Seattle population increase over the same time period. Two areas considered favorites by analysts for the second Amazon headquarters, Boston and Washington, D.C., have experienced their own surges.

King County Executive Dow Constantine opposed the higher head tax and praised Durkin's compromise proposal.

Under the amended tax, Amazon will be on the hook for about $11 million annually, rather than the $20 million that the original proposal would have levied. "A tax on jobs at any level is bad economic policy and will negatively impact Seattle's economy and city tax revenues".

Scruggs reported from Seattle.


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