Seattle officials reversed themselves on a new tax on large companies almost as fast as you could have a pound of Starbucks coffee delivered by Amazon.
The new tax of $275 per employee was put in place just about a month ago. The city council voted unanimously at the time to put the levy in place, saying the nearly $50 million a year it would bring in was crucial to deal with a mounting need for low-income housing and services for the rising number of homeless in the city.
Amazon, the city’s largest employer, was strongly against it, and along with Starbucks, also Seattle-based, was planning to try to get it repealed on the ballot in the fall. But city council members didn’t wait that long.
The same city council voted 7-2 on Tuesday to repeal the tax.
In a statement on her website Monday, Seattle Mayor Jenny Durkan said she and other supporters of the tax saw a fight to preserve it as unproductive.
“It is clear that the ordinance will lead to a prolonged, expensive political fight over the next five months that will do nothing to tackle our urgent housing and homelessness crisis,” the statement reads. “These challenges can only be addressed together as a city, and as importantly, as a state and a region.”
The proposal led a number of local leaders to fear that Amazon and other large employers might not only lead an expensive fight to repeal it, but might be less likely to consider expanding in the city, or coming to Seattle in the first place. After the tax was enacted, Amazon put construction of a new high rise on hold.
“We heard you,” Durkan said in the statement. “This week, the City Council is moving forward with the consideration of legislation to repeal the current tax on large businesses to address the homelessness crisis.
“The City remains committed to building solutions that bring businesses, labor, philanthropy, neighborhoods and communities to the table. Now more than ever, we all must roll up our sleeves and tackle this crisis together. These shared solutions must include a continued focus on moving our most vulnerable from the streets, providing needed services and on building more housing as quickly as possible.”
Durkan and other backers of the tax, which would have gone into effect in 2019, have said they have no backup plan yet for raising the revenue to replace what it would bring in.