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‘Amazon Tax Legislation’ unveiled — Plan would tax payrolls of Amazon and Seattle’s ‘825 biggest companies’

Swatting away ethics concerns, Seattle City Council member Kshama Sawant unveiled her proposal Wednesday morning that would raise $300 million for housing and environmental initiatives with a tax on Amazon and Seattle’s largest payrolls.

“On behalf of our movement, I’m excited to put forward this bold, transformative proposal,” Sawant said. “We know that big business, the wealthy, and the political establishment will staunchly oppose this, and that we will need a powerful movement. If we win, this will not only transform the lives of Seattle’s working people, it will set a historical marker for cities around the nation.”

The online giant remains in Sawant’s crosshairs. Sawant’s official Seattle City Council press release on the announcement calls her proposal the “Amazon Tax Legislation.”

The base of her proposed legislation: raising $300 million a year for housing and environmental initiatives through a payroll tax on the city’s largest 3% of businesses. The proposal would create a 1.7% payroll tax on the businesses with $7 million and above in annual payroll. Most of the funding would go to housing programs with around $75 million a year going to Green New Deal initiatives.

Sawant’s office says the “825 biggest companies in Seattle would pay the tax” — with “the remaining 97 percent of companies – about 22,200 – would pay no tax under the proposal.”

Non-profit organizations, public employers, and grocery stores would also be exempt.

The announcement comes after it was revealed that the third-term council member representing Capitol Hill and Central Seattle faces charges over alleged ethics violations for using her office to promote a potential ballot measure related to the tax. While the charges could further inspire Sawant’s political opponents and critics, they seem unlikely to dent the “Tax Amazon” movement she has aligned so closely with her third term on the council. If the Seattle Ethics and Elections Commission determines Sawant was in the wrong, it could fine her up to $5,000 per violation.

Sawant’s announcement, meanwhile, doesn’t mention the possibility of bringing the issue to voters in November but advocates for the tax have said a ballot measure will be an option if Seattle City Hall fails to act.

Sawant is also facing a fight in Olympia. CHS reported late last month about a state proposal that would open the door for King County to tax large employers to support housing and homelessness services. Many of the area’s largest companies including Amazon and Microsoft have said they will support the state bill — if legislators add restrictions preempting cities from passing their own taxes on businesses to pay for housing and homelessness. Under the proposed legislation, Washington counties with populations greater than 2 million would be allowed to enact a 0.1% to 0.2% tax on the payrolls of large employers. There would be a myriad of qualifications. Only companies with employees making more than $150,000 would be taxed and the pay of any employees making less than the $150,000 threshold would be deducted. Grocery businesses would be exempted as would any business with 50 or fewer employees if half of those workers make less than $150,000.

Proponents of a tax on businesses in Seattle have called on state legislators to not introduce preemption amendments to the bill that would stop cities from enacting their own payroll and head taxes.

Sawant says the $300 million raised by her proposal would allow Seattle to build 8,000 new affordable, “publicly owned or controlled homes” over the next 10 years and “retrofit 47,000 existing homes in the city to meet Green New Deal standards.”

The Sawant proposal would not be a Seattle Head Tax sequel. In 2018, the city council passed and then rolled back a $275 per full-time employee tax on companies reporting $20 million or greater in annual “taxable gross receipts.” That tax would have generated about $50 million annually.

Sawan’ts office says the new proposal is closer to the 2018 voter-approved measure in San Francisco that taxed businesses to fund housing and services.

“Companies here have reaped billions because Washington state has the most regressive tax system in the nation. It’s time for Amazon and other major corporations to pay their fair share,” Sawant said.[0]=68.ARDwoucFTX_oFUpMDs2pyZFVSjdq9WMDah8dl2AI3UOyyBWRAwIu8633qgVAVv5s-KZb-LPaA2yHX0x1GdY4g2r9VsbB1vTCDy7XVongtYDOA77Q4DjEfz758lRqD9L532SlTaCqlnckevJEVyL4Bq4tHHcaOPUi8-CZ__MFiFB7YRmNvNFde3wgqOg63iG91B9drXS8jfkNPwtLqypcfSYj3QFvICRm8GRQPj-c3szuHR2yIR-RqWcr4udcymc8nVssQgE62BQ_0U1_jgLBRW_QRDVlOtwnUysETeo101nYomhs1kSWa_w5_85iN7UlXDOXzZ5X3ekDCWaYs7xJnrDAiWT013hkruE&tn=-R

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32 thoughts on “‘Amazon Tax Legislation’ unveiled — Plan would tax payrolls of Amazon and Seattle’s ‘825 biggest companies’” -- All CHS Comments are held for moderation before publishing

  1. How long until Sawant and her staff gets bored of this new campaign, and finds something new and shiny to rally around?

    Or, to put it more charitably, why wasn’t this the centerpiece of her 2019 reelection instead of rent control? I am not aware of new data that would lead her to champion this instead of rent control all of a sudden.

    I hope someone runs against Sawant’s paper-thin record in 2023 instead of against her ideology.

  2. If Ms. Sawant would spend a fraction of the time monitoring and evaluating the effectiveness of the $195 million dollars that Seattle and King County invested in this problem last year, than she does raging at Amazon, perhaps then I would listen to her efforts at raising more money. Money can be part of the solution, but the resources are not infinite. If our City Council would spend this money like it’s coming out of their own pocket, perhaps they would care more about what previous investments are working and which are not, before asking for more.

  3. So first of all it’s not politics that led to the exemption of grocery stores, but the fact that vulnerable people in urban areas find it hard to find food in their communities (food deserts). Cutting into the low 3-5% profit margins that grocers realize may exacerbate this issue.

    Meanwhile Amazon enjoys profits of 22% amounting to billions of dollars every year. Amazon has benefited greatly from Seattle and paying money to assist people who have been left behind during their stratospheric growth is not an unreasonable idea.

    The people who comment here sound like they only know the most recent version of Seattle, but the growth of Amazon has been tough. There’s been some good, but it’s nuanced, and most of the good has been enjoyed by a small minority.

    I am in tech, I benefit, and my company would be one to pay this tax. Our companies: Apple, FB, Google, etc. can’t continue to come here and enjoy the benefit of all of this talent for free. They ought to be expected to help our entire community more than they are. Sales tax revenue alone is not cutting it and I’d like to live in a city where a diverse population can make it work, not just us in tech.

    • I don’t disagree with you nor do I think the corporations in the cross-hairs of this legislation would either.

      I think the issue has more to do with an inept council that has failed to show any kind of progress with the funding they have. Now they are demanding more money with the promise that it will solve all our city’s social ills. I can’t believe that it will given that the council has yet to make any progress given the dollars they have. There was even an audit that said as much.

      This is the reason why the head tax failed last year. Not because people (or even the top corporations in Seattle) are against providing social support to those in need. You can look at every election that includes tax initiatives that always pass. People are willing to provide support but, I believe, most want to see some results from the dollars we’re providing.

      Personally, I would like to see a detailed proposal for how the dollars would be spent and how our dollars have been spent so far (and those results). I want a concrete plan, not a hyperbolic political slogan that easily fits on a poster. Surely you can agree this isn’t asking too much of our council and Sawant?

      • If you plugged your washing machine into a 50-volt electrical outlet, it wouldn’t work. Would you consider that an indictment against electricity?

        Likewise, the argument that our existing budget should be enough to end homelessness doesn’t pass muster. Look at research recently done by McKinsey. Look at research done over the past few years. Look at studies that show how much it costs to build and maintain affordable housing units. Look at Seattle’s 90+-year history of exclusionary zoning, a shameful heritage of othering that continues to be endorsed by our largest daily newspaper. (Some also blame 25-year old Amazon for the problem, which is an amazing example of projection.)

        Seattle doesn’t just need $195M to address homelessness. We need much more than that from the public and the private sector. We talk so much about taxes, you’d think our taxes were extremely high. They’re not – at least not on individuals. We buy so many Bernie bumper stickers that you’d think our taxes were progressive. They’re not – they’re the most regressive in the nation, year after year. Look at cities that fund public education without a Supreme Court decision force them to do so. Look at other states. Look at other countries. Really think why we’ve chosen to make ourselves an anti-tax haven for corporations over the past century-plus.

      • Hey Jason, I didn’t say that $195 million will/should solve the problem. I said let’s examine what is working and what isn’t working. Then fund the things that are working. That was part of the plan a few years ago. They were going to see which programs met their goals and which didn’t. Then just fund the ones who met the goals. Of course they then decided to fund them all again anyway. This is not a demonstration of working responsibly in the public interest. If they evaluate programs and fund the effective ones, and demonstrate that they are good stewards of our money, then I can see why they need more. You mentioned all the studies that say we need to spend more. I remember the studies before that, that said we could solve it for 1/3 of the $195 million. It’s silly to keep throwing money at it without accountability. Your 50-volt washing machine metaphor is a bit disingenuous don’t you think? If they sold us the washing machine saying that it only needed 50 volts, then told us it needed 75, then told us it needed 110—now we’re getting closer to the argument about the homeless problem.

      • Jason’s analogy is not wrong. $195 million is a significant, but still small portion of the $400 million to $1 billion+ needed to properly address the homeless problem.

        The other issue, which you briefly touched on, are the small, but proven and useful improvements that we could be doing to address the problem. The issue with these is that we have a very small, but very vocal minority (Bob Knudson, Safe Seattle, I’m looking at you!) that are ignorantly opposed to a vast majority of these solutions.

        They moronically believe that these services encourage homelessness (being homeless on the streets is not Easy Street, if you don’t believe me, try lasting a night outside of your comfortable home), when in fact they are all proven to help bring people out of homelessness and drug usage and become functional members of society. We need to stop listening to these uninformed rabble-rousers whose opinions are not based off of facts, but rather their narrow minded view of reality.

        These are things like:

        Urban Rest Stops to allow homeless to clean themselves up and do laundry. Both vital first step services to homeless people looking to get their lives back on track, especially with employment opportunities, housing applications, etc..

        Tiny Houses give people a place to stay, rather than sleeping on under bridges, in store fronts, in parks, on sidewalks, etc.

        Safe Injection Sites (definitely the most controversial) provide addicts a safe, clean environment with attending medical staff to inject drugs and provides an opportunity for staff to provide a route to drug treatment opportunities that is not available when people are doing drugs on the streets. 30 years of studies from Europe prove that these do NOT in fact encourage drug usage, and DO prevent costly overdoses and help a significant amount of users transition to treatment opportunities they would otherwise not have access to on the streets.

        There are more solutions (housing, mental treatment, drug treatment, etc) that I won’t touch on, but in the end, we need to stop the “Ignore the problem and maybe it will go away” solution that has persisted for decades, because that’s how we got here in the first place.

      • @Jason
        “If you plugged your washing machine into a 50-volt electrical outlet, it wouldn’t work. Would you consider that an indictment against electricity?”

        No but it would be the proof, along with the owner’s manual, that I need to find an outlet with a higher voltage.

        Your analogy actually illustrates my comment fairly well. We not seen any proof from the city council that our efforts at reducing homelessness are or aren’t working. What have we tried that failed and what have we tried and is working? How much do we need to spend to scale what is working? Let’s figure that out before trying to claw away more money that we likely will just continue to burn through.

        To use your analogy again: it would be like saying a 50-volt outlet doesn’t work; we must need a 5,000-volt outlet! Making a judgement call without the benefit of actual knowledge of what it takes to power your washing machine.

  4. ” If we win, this will not only transform the lives of Seattle’s working people, it will set a historical marker for cities around the nation.”

    Just more hyperbole and balderdash from the self-promoter-in-chief.

  5. 25% of the tax for converting gas homes to electric?? What does that have to do with building affordable housing? After digging up an oil tank 25 years ago and converting to gas, does she have any idea how much it would cost to make this 115 yr. old house an electric home? Does she know how electricity is produced?

      • Time to upgrade our outdated and old power grid you mean. That’ll take more than a few electricians and millions. But hey, blackouts are a great equalizer.

        Never can understand how these messiahs broadcast stuff like banning gas and oil furnaces when they can’t even deliver on the infrastructure to support such ban. Even worse, people fall for their schtick. Too much dope in this town.

  6. And….housing for homeless won’t even work!! We need to do something drastic. I have a mentally ill sister, homeless on the streets, living in a tent in Tacoma. The city just put her in a nice apartment, she had been on a list. $250 a month for rent. All she has are what she carried on her back. She is sleeping in a corner of an empty apartment on the floor. Yes, I could get her furniture, a bed…but I know she will be out on the streets again soon. She goes to the homeless shelter for meals. The neighbors are already complaining about her strangeness and her smoking pot in the apartment. She, and all the other homeless and mentally ill need to be institutionalized!! Period. They need to be taken care of, food, drugs. This is so inhumane the way we treat them. Sometime in the 1960s they shut down all the mental institutions, and put people on the street. Basically to save money. Here we are. Thinking just a tiny house or roof over their head will cure mental illness. I cry for my sister, there is nothing I can do for her, and there is nothing the city is doing for here that is effective. So, all this big business tax money, if it even happens, won’t be effective. Tiny homes, give me a break. Wouldn’t we save money by changing the laws where we can once again commit mentally ill people to institutions where they can be cared for, rather than have them sleeping and shitting on the streets, ruining businesses and tourism, the cost for shelters, food banks, our social security money (she already gets $800 a month for being “disabled” thanks to lawyers who do this for the folks, and it just goes for drugs to self medicate their mental illnesses). What a mess, and such a sad thing to do to our fellow humans.

    • I agree with you about the mentally ill homeless, which seems to be a significant part of the overall population. There are medications which can be very effective for them, but it’s almost impossible for a homeless person to comply with such treatment while they are on the streets, and to be monitored appropriately by a professional. This can only be done in an inpatient setting, and if that means a long-term institution, then so be it.

      We are not doing the mentally ill homeless any favors by allowing them to camp outside in a degrading and unhealthy manner. Why can’t we, as a society, do better by them?

  7. And I forgot to mention, that I totally agree with figuring out a way to use what we already have, rather than tax large businesses, which may just cause them to go elsewhere, along with the jobs. If we used our tax money more wisely, we wouldn’t need to tax more. That goes for the school levies as well, I can’t believe they passed…again.
    I keep hearing Sawant say “fair share”. To me, that would be a flat tax, same rate for everyone and every business. That would be “fair”. I have a lot of money, because I chose not to have children, and worked two full time jobs when I was young, made lots of sacrifices, and worked very, very hard. Why should I have to pay a higher percentage of taxes, because I worked so hard, to someone who chooses not to work so hard. Socialism is so scary. It’s never worked.

    • You only talk about how hard you worked. So many people work so much harder than you ever did and are forced to pay the most regressive taxes in the country thanks to your crybaby bulls$it. We need an income tax now. Jeff bezos just bought one home for $165 million dollars but refuses to pay anything to significantly impact the homelessness crisses he caused. You’re supporting that.

      • Down with taxes!
        Down with schools!
        Institutionalize the homeless!
        Nobody works as hard as I do!
        Save our tourism!
        Protect big tech!
        Nobody is wiser than I am!
        Social services bad!

        Typical selfish boomer logic.

      • Sara, you sound full of hate and contempt. Everyone else here is having a discussion, you are are name calling with a lot of contempt. You don’t even know me, and you hate me. We can’t accomplish anything with this kind of attitude.

      • I don’t hate anyone, just pointing out that your ideas are incredibly selfish and self centered. Also, this website is not your personal echo chamber to demonize the homeless or showcase your support for regressive flat taxes that disproportionately affect people with lower incomes. The only hate and contempt I see is your own for those less fortunate than you. Shameful.

      • Hey Sara. I can tell that you are very passionate about this topic. That’s great. Passion is good. I do think that perhaps you are generalizing who you are talking to here. You seem to think that we are all self-absorbed, insensitive boomers. I don’t think lecturing to me will help convince me of your perspective. Although I feel I have worked pretty hard, I’d never say that I’ve worked harder than anyone else. I never say I’m smarter than anyone else. And I know that I’m really fortunate based on my race and the home I was born into. I did put myself through college—the first generation in my family. But I know I’ve had it easier than many. But I’ve also been successful in my life because I’ve invested wisely. I tend to not waste money. And my concern is that we need to make sure we are making the most of the money we’re already spending on this dire situation. That’s why I suggest that we do a better job of tracking the effectiveness of programs, so we can put more resources where it does the most good. We may very well need to invest more money that may require more taxes, but I think the city council is taking the easy way out. They are focusing on changing State law that will enable them to add $300 million to the pot. If they would prove that they have a plan for that money, based on the success of the existing work, I’d be more likely to support them. I bet that businesses like Amazon would even get behind things like this as it would help their image. But instead it’s just a lot easier to yell at Bezos and Amazon as the evil empire. A few years ago, “experts” told us that $80 million a year would solve the problem. Now we’re spending more than twice that and things are worse. I think there’s something wrong with this trend. Isn’t it worth baking in some accountability?

      • 1. I wasn’t replying to you but ok.
        2. The problem is getting worse because the forces that caused a surge in homelessness, addiction and crime are running unchecked. Now they will be and you don’t like that. Too bad.
        3. In a democracy, leaders are elected to enforce and spend taxes to address issues based on the platform they were elected on. If you don’t like that you can run for City Council.
        4. New studies have shown that 80 million is not nearly enough to address the problem, nor will the money sought through the state legislature be either. It’s actually closer to $500 million a year. You claim it’s the City Council’s fault for mismanaging the small amount they raised for housing and homelessness but it’s actually because there is simply not enough tax revenue being raised to make a meaningful impact. Hopefully the City will not be premepted by the state legislature from holding big tech accountable for their ethical failures and the damage they’ve done to Seattle. We shouldn’t have to force them to be good corporate citizens but enough is enough.

      • My fear is that there will always be “a new study.” There was good faith in the study that said $80 million would be enough. They brought in two experts from outside our area. They both concluded that this would be enough—if we spent it in some specific ways. Well, we didn’t spend it in those specific ways. And now it’s worse. I don’t know who or what to believe. There’s a lot of finger pointing going around. But I don’t read much about what programs are working and what are not. And now, this new proposal has 75% going to combat homelessness, and 25% going to convert houses to being more green. Wow. It just seems like they are throwing stuff at the wall. It seems that if $300 million isn’t enough, then we shouldn’t be taking 25% of it to put toward a green effort. This reminds me of the City Council also voting to accountability
        an issue in India. Gee whiz. Let’s focus, people.

  8. Sara, you should go yell at the council for giving $14 million to build a giant tropical aquarium for tourists then. Aquarium is bad for the environment, expensive to maintain and those fish die prematurely in captivity. Where’s Sawant here? How about the Downtown Association wanting $40 M for 3rd Ave beautification? How about the $12 M/ mile bike path or the trolley? Where’s Sawant’s megaphone here?

    Sawant is part of the problem with runaway spending. This city has no fiscal prudence or discipline.

    Oh and if you want something to sink your teeth in. Get Sawant to push the city&county to buy the state land (National Guard Armory) in Interbay. It’s a 25 acre site and can hold thousands of housing units for the working poor, middle class families and house the homeless and their services. Any peep from Sawant? Zip. Zilch. Nada.

  9. City funded cash rental assistance NOW! There is no housing shortage! There’s only a cash shortage among poor people due to the funneling of wealth to the rich and away from the working class. The houses exist if the poor could afford them. Cash assistance NOW!

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