After a weeks-long dispute, the Seattle City Council gave the green light to a controversial head tax on the city’s largest companies. The tax will help fund the municipality’s programs for the homeless.
In addition, the new levy would bring an extra $48 million per year to the city’s budget. The initial goal was $75 million per year, but the decision irked Amazon, the city’s largest employer, and Starbucks.
Mayor Jenny Durkan (D) said that the new tax is the result of a “tough debate” and compromise. The city originally wanted companies that earn over $20 million per year to pay $500 for each employee. The compromise tax is $275 per employee.
Durkan is confident that the new head tax would lead to a “meaningful difference” in the way the homeless are treated. The municipality hopes to draw more funds toward fixing its homelessness crisis.
Amazon, Starbucks Blast the New Head Tax
Amazon did not share the mayor’s enthusiasm over the new law. The company described the tax as a “hostile approach […] toward larger businesses,” while threatening to stop creating new jobs in the Jet City.
In a recent statement, the e-commerce giant announced that it was “disappointed” by Seattle’s decision to enforce a head tax for large companies. According to Amazon’s calculations, Seattle’s revenue growth outpaced population growth, which means that the city has spending efficiency issues, not funding shortages. Amazon labeled the new head tax as “anti-business.”
Starbucks also criticized the city’s council over the decision. The coffee chain believes that the city lacks accountability when it is spending recklessly. Starbucks thinks that a city that does not have enough funds to offer a warm meal to a 5-year-old will never be able to offer affordable housing or help opiate addicts kick the habit.
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