Seattle passes a smaller version of the 'Amazon tax'

Seattle passes a smaller version of the 'Amazon tax'

Seattle passes a smaller version of the 'Amazon tax'

One of Seattle's most controversial proposals in years passed unanimously in city council today - but after some significant revisions.

The newly passed ordinance, which takes effect in January 2019, will impose a "head tax" on the city's highest grossing businesses.

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A proposal to tax companies $500 per employee was being considered for several weeks but, after Mayor Jenny Durkan threatened to veto it, the council voted to reduce the size of the tax.

Sponsors of the tax said Seattle's biggest-earning businesses should bear some burden for easing a shortage in low-priced housing that they helped create by driving up real estate prices to the point where the working poor and many middle-class families can no longer afford to live in the city.

Amazon's Herdener said the company will resume construction planning on the office tower it had paused.

"This is the richest city in the state and in a state that has the most regressive tax system in the country", said council member Teresa Mosqueda, who supported a larger tax but called the plan "a down payment" to build housing the city needs.

The $500 tax would have cost the company $20 million a year over the next two years, according to The Seattle Times. A point-in-time count past year tallied more than 11,600 homeless people in King County.

However, he added, "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".

Almost 600 employers with gross revenues of more than $20 million - including Starbucks and Amazon - will be expected to pay the charge in Seattle from next year onwards.

The approval Monday brought a victory for Lisa Herbold and Lorena Gonzalez, the legislative architects on the plan, and, maybe, some time to finally rest after a weekend of negotiating.

Some construction workers opposed the tax out of concern for their jobs while supporters pressed the council to do something about the rapidly expanding number of homeless families in the city.

"By threatening Seattle over this tax, Amazon is sending a message to all of our cities: we play by our own rules", the letter said.

The modified tax should generate some $50 million, much of which will be dedicated to "deeply affordable" housing in the city to be made available to people below the poverty line, with some going to emergency shelters and other social services. The money will reportedly be used to combat Seattle's raging homeless problem, but critics are asking what's happened to the millions already spent on such programs over the last few years.

"As a union rep, we meet with our employers to discuss our problems and come up with solutions jointly", Bufford said.

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