MENU

Reason.com

Free Minds & Free Markets

Seattle Now Wants to Repeal Controversial Amazon Tax

Tax proponents folded rather than defend the tax from a increasingly popular voter initiative to repeal the tax.

Lindsey Wasson/REUTERS/NewscomLindsey Wasson/REUTERS/NewscomLess than a month after unanimously passing a literal tax on jobs, the Seattle City Council is looking to reverse course.

Yesterday Seattle Mayor Jenny Durkan, along with seven of nine city councilmembers, released a statement announcing their intention to repeal the controversial employee head tax.

"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," reads Monday's 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."

Had the City Council not killed its own head tax, voters might have.

Almost immediately after Durkan signed the tax into law, an initiative campaign was launched to put the head tax on the November 2019 ballot. Within days the campaign had attracted $300,000 in funding including $25,000 a piece from Starbucks and Amazon. The effort reportedly gathered 22,000 signatures by June 7, comfortably above the 17,000 it needed before its June 14 deadline.

Rather than risk an expensive ballot campaign that public opinion polling suggested would not go its way, the council has decided to pull the tax and try again.

The initial version of the head tax—known as the "Amazon Tax" after its main rhetorical target—would have imposed a yearly $500 levy on every employee at companies grossing over $20 million. This was supposed to raise $75 million annually from 500 to 600 Seattle businesses for homeless and affordable housing services.

That proposal sparked fierce opposition from all corners of the city. Seattle-headquartered Amazon paused construction on an office tower project pending a vote on the tax. Starbucks came out publicly against the tax, as did Alaska Airlines, Expedia, and the CEOs of 129 other Seattle-area companies in an open letter.

The business community was joined in their opposition by the city's construction unions. Chris McClean of Iron Workers Local 86 told The Seattle Times that "to reduce the jobs only increases the possibility of additional homelessness." His union brothers shouted down pro-head tax city councilmember Kshama Sawant at one of her anti-Amazon rallies.

The head tax was even too much for former Seattle Mayor Tim Burgess, a champion of such progressive policies the city's soda and income taxes. Burgess co-authored an op-ed in the Seattle Times calling the head tax a "terrible idea."

All the pushback was enough to prompt Durkan to float a compromise head tax of only $275 per employee per year, which would have raised $47 million annually. This saving measure proved ineffective at quelling the passions stirred over the tax.

As columnist Knute Berger wrote at Seattle news site Crosscut, "the mayor had forced an unsavory compromise by signing a head tax that was less than originally proposed yet still too much to win Amazon's support or tolerance, and a spending plan that was not well-devised before the vote."

The Amazon tax is not the first example of the Seattle city council putting the cart before the horse. The city-level progressive income tax passed last year by the council was ruled illegal in November 2017 on the grounds that Washington state law explicitly forbids cities from imposing an income tax. A city appeal of that decision is still pending.

The reaction to Monday's about-face suggests that while the fight over the head tax is over for now, the tensions it kicked up have not dissipated.

Seattle's hard left was positively incensed at the reversal. "Councilmembers who said they agree w/ big biz tax to fund affordable housing now want to repeal Amazon Tax coz blatant lies by big biz have impacted public opinion," tweeted out Sawant who says she was left out of the loop on the decision to ditch the head tax.

For their part, business owners stressed that the city needed to spend the money it has more effectively before it goes around asking for more. "I strongly believe that there is a better way forward, one that improves current spending efficiency and effectiveness all while encouraging economic growth and job creation," said Denise Moriguchi, chief executive of Seattle grocery company Uwajimaya, to The Seattle Times.

With Monday's press release from Durkan and the councilmembers still emphasizing the need for "progressive revenue sources," these battles are not likely to disappear any time soon.

Photo Credit: Lindsey Wasson/REUTERS/Newscom

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  • BestUsedCarSales||

    Don't give them credit. They wanted to rule by fiat, and they expected the citizens to take it (as they usually do, honestly).

    They only backed off their horrible idea because it was so universally reviled that they could not just play it off. Wait until the one self-avowed Socialist councilmember talks today. She's giving a talk at 11. She will probably double down, and probably talk about how the big businesses are even turning the citizens against their best interest.

    Fucking bullshit. Seattle is fucking bullshit.

  • JesseAz||

    She claimed already that voters were idiots being pressured by evil corporations into signing the referendum.

  • Leo Kovalensky II||

    AKA the people they work for.

  • libertynugget||

    This ^^^

  • plusafdotcom||

    Oh, Richard, just fuck off, asshole...

    This is a Libertarian site... no libertarian in their right mind would ever recruit people to compete with them in their own job market.

    Unless you're touting an Amway-style pyramid scheme....
    So, fuck off...

    http://www.plusaf.com/homepage.....retard.jpg

  • Earth Skeptic||

    You mean the companies that hire and pay them.

  • esteve7||

    again, the leftists always fucking project. I'm sure she's okay with union thugs thumbscrewing people into joining the union.

  • Anacreon||

    I hereby nominate Kshama Sawant to receive the Nobel Prize for Obstinate Stupidity.

  • Chipper Morning Baculum||

    They will re-brand it to something like End Child Molestation (and also homelessness) By Slightly Increasing Your Amazon Prime Membership Fee Act.

  • BestUsedCarSales||

    Damn fee already went up 30 bucks.

  • BYODB||

    It's worth it just to be able to watch Goliath. I gotta admit I'm a Billy Bob fan.

  • dan'o en barrel||

    I'm disappointed. If the measure held then the fleeing businesses would add to the aggregate data demonstrating the stupidity of these schemes. Obviously I'm naively optimistic. It would only add a grain of sand to the beach, and a huge chunk of the country is happy to ignore its existence in favor of preserving a frothy sense of moral superiority.

  • Red Rocks White Privilege||

    There's plenty of cities that charge a head tax, but it's typically a pittance--Denver, for instance, charges $5.75. The biggest problem is that Seattle's commie degenerates actually believed they could pass a *$500* per person tax and companies with the resources of Amazon and Starbucks were just going to bend over and take it up the tailpipe BECUZSOSHULJUZTIZ.

  • ||

    I live in Seattle, and I'm sad to say this crap is nothing new.

    The Seattle city government considers itself wholly sovereign from the State of Washington and the US government, as shown by many, many, many things they have tried to enact laws about that conflict with state and federal laws, and the state and federal constitutions. Seattle has gone to court many times arguing that local authorities should be superior to a distant state or national government, and have nearly always lost.

    Seattle is the county seat of King County. King County is a little island of blue in the sea of red that is most of the rest of the state. But King County has the highest population, so they get a lot of say in state politics.

    The thing is though, if a neighborhood somewhere in Seattle were to get together and vote for an ordinance that conflicted with City of Seattle ordinances, the city would declare the vote invalid and then happily send in the police to arrest the 'criminals' if they persisted. Because even though Seattle is special and sovereign (it isn't), their subordinates WILL do as they are told.

  • Elias Fakaname||

    As someone in Spokane who suffers because of Seattle's Marxist whims, I say put the city under martial law.

  • Longtobefree||

    Because nothing says help the homeless like killing jobs?

  • Scarecrow Repair & Chippering||

    "Progressives must love the homeless, they make so many of them."

  • perlchpr||

    The poor in general.

  • Earth Skeptic||

    Just like Jeebers.

  • Hackmaschine Mutter||

    Because nothing says help the homeless like losing city revenue by driving the jobs somewhere else.

  • BestUsedCarSales||

    If you ask anyone, the core reason for the homeless is that the city is now too rich for normal people to live there.

    People don't focus at all upon the horrible city planning that makes building new multi-person homes very difficult.

  • TrickyVic (old school)||

    DeBlazio has pledged NYC will open another 90 shelters.

    Let the NIMBY begin.

  • TrickyVic (old school)||

    I like screwing with the progressives when they complain about gentrification and new condos. I tell them the city needs all that tax money it provides to pay for more social services.

  • esteve7||

    Useful example that the socialists will never stop trying, no matter how often their failed ideology is tried. Why any business or person would want to move there is beyond me. The ideology they follow will lead to them putting up a wall and shooting people trying to leave.

  • Sevo||

    "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," reads Monday's statement. "

    See, it's not that it was among the most bone-headed actions a government could take. Nope, it's that it would lead to a 'political fight'.
    I understand that lying to a federal agent is a crime; how about lying to his bosses, the voters?

  • BYODB||


    I understand that lying to a federal agent is a crime; how about lying to his bosses, the voters?

    I think this is actually in the job description.

  • JesseAz||

    The main problem for the city council was not waiting 10 years for the first generation of common core math graduates to become voters. Some democrats still understand basic math.

  • Jerryskids||

    "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 old "I'm sorry you're too stupid to understand how smart I am" apology.

  • JesseAz||

    Urgent housing can be fixed by relaxed zoning laws. But that is never discussed.

  • Derp-o-Matic 6000||

    Nonsense. Seattle just needs to take all of Amazon's money, then...*vague hand gesture* and BOOM! Homelessness solved!

  • TrickyVic (old school)||

    I always find it funny when people say 400 Billion (or whatever) would end homelessness or hunger. It tells me the really don't understand the basic issue. Sure you could feed people with the money, but what happens when the money runs out? Where will the next meal come from?

    You could build a lot of small homes for that money too. But what about upkeep and property taxes?

  • perlchpr||

    Tax and tax and tax some more, until everyone is equally poor.

  • Cy||

    As the saying goes: "Cuts aren't all that bad, when you're the one with the knife."

  • BYODB||

    Or, to borrow from one of the great authors of our time:

    It's unpleasantly like being drunk. What's so bad about being drunk? Ask a glass of water.

  • TrickyVic (old school)||

    As Bloomberg said, the only good tax is the one that taxes the other guy.

  • Sometimes a Great Notion||

    Libertarian Moment?

  • Cy||

    More like a slight grade change down the slope into communist oblivion. Recently Seattle has had a huge influx of some very VERY left "thinkers."

  • Sometimes a Great Notion||

    I can dream, can't I? Or is that covered under hate speech?

  • Hackmaschine Mutter||

    Some Ambien & Jack will more likely get you to that dream.

  • Mickey Rat||

    Progressives always seem to forget that private sector unions have the same interests as their companies generally, especially when the issue directly impacts their jobs. Unions operate on one principle, what is in the best interests of the union.

  • Cy||

    Theoretically you're correct. But, most Unions have had their teeth pulled by the Federal government and now they usually just do what's in the best interests of the Union Leaders and the companies they 'negotiate' with.

  • Mickey Rat||

    Unless the issue is a dispute between the company and the union, the union's interests always align with the company's. Making a unionist's job more expensive to the company without any direct benefit to him, is a way to.earn his opposition.

  • Rhywun||

    Is it possible that Seattle voters are seeing through the complete BS that the extra money is "for the homeless"?

  • BestUsedCarSales||

    I've seen some complain about that. But still many seem to take them at their word, that it is earnestly for homelessness. Even worse, many seem to take their estimates on what the problem takes to fix at face value

  • TrickyVic (old school)||

    ""complete BS that the extra money is "for the homeless"?""

    More like money for the agencies that provide the services. Not money for the homeless people themselves.

    Social services has become a friggin industry in NYC.

  • Rhywun||

    No. That money will go toward public sector employee pensions before it goes anywhere else. The homeless, which yes I using as shorthand for the agencies, won't see a dime of it.

  • buddhastalin||

    Bingo. If you want to know what Seattle will look like in the future, take a look at San Francisco, where the homeless industrial complex, receiving about $300,000,000 every year from the government, is an entrenched special interest that ain't goin' nowhere.

  • Earth Skeptic||

    You mean The Homeless (TM). Our progressive humanistic corporation employs lots of English majors, but does not have anything to do with the homeless (i.e. those smelly people under the freeway).

  • Enjoy Every Sandwich||

    Had the City Council not killed its own head tax, voters might have.

    How DARE they go against the will of their benevolent masters! What the fuck do they think this is, a democracy or something?

  • TrickyVic (old school)||

    ""head tax, "'

    I didn't know prostitutes were legal in Seattle.

  • Number 2||

    "Durkan and the councilmembers still emphasizing the need for 'progressive revenue sources'"

    They're going to tax Progressives? Great idea!

  • Elias Fakaname||

    It is more efficient to harvest their organs for profit. Which will have the added benefit of thinning the herd.

  • Libertymike||

    In order to MAGA, no further inflows of Maharashtra Maoists should be tolerated.

  • Cy||

    But what about the children!??!?

  • Libertymike||

    Are there any Maharashtra Mackeys (as in John)?

  • Diane Reynolds (Paul.)||

    Businesses get a win on head tax, but solution to Seattle homelessness crisis still elusive

    What do you guys think of that non-sequitur of a headline?

    "Ida Mae Jenkins wins apple pie bake-off, but homelessness crisis still elusive"

  • BestUsedCarSales||

    They just want the homeless gone because sales of The Homeless Times is cutting into their market.

  • Sevo||

    "Ida Mae Jenkins wins apple pie bake-off, but homelessness crisis still elusive"

    Pretty sure you could start a profitable game web-site based on that sort of statement.

  • Juice||

    Are they just saying these things to make the referendum go away? Do they actually intend to repeal the tax?

  • Pro Libertate||

    They are now libertarians. The moment has arrived!

  • Hackmaschine Mutter||

    The moment was on Metro Transit but there was a derailment before the station.

  • Pro Libertate||

    So close!

  • 100% Satisfaction Guaranteed||

    I bet there's an article in compiling all of the predictions of cost for these public charity projects, and then comparing them to the real cost as it played out.

  • Jerryskids||

    Not an article, just a sentence. A good government program is one that merely takes twice as long at twice the cost to produce half the benefits promised.

  • JesseAz||

    Are you calling the 60 years of cbo projections a lie?!?! I said good day sir.

  • libertynugget||

    Technically the tax would probably help relieve housing shortages.
    Tax company
    Company finds somewhere better
    employees leave to find work
    more houses with less demand equals affordable housing.

    more vacant houses, more squatting opportunities.

    It'll be like Detroit only Rainy and better coffee...
    hell coffee might even be cheaper

    TAX EVERYTHING!!!!!!!!!!

  • Pro Libertate||

    100% taxes, no deductions. Don't worry, you'll get back what they think you deserve.

  • ThomasD||

    Oh be realistic.

    They'd like to give you back what they think they deserve, but what with overhead and expenses you'll just have to settle for getting a third of what they think you deserve.

    But do recognize that what little you receive is in no way indicative of just what they think of you.

  • HGW xx/7||

    I long for the day that the Cascades become the new Coast Range and the Olympic National Park is a quaint, northwestern version of Hawaii.

    Having grown up close to Portland, and then living in the Seattle metro, how the average, seemingly normal voter can continue to vote for - i.e. encourage - the left to run the ship just shows how fucked those places are. Absolute lost causes. Every one of those commies can DIAF.

  • Jerryskids||

    With Monday's press release from Durkan and the councilmembers still emphasizing the need for "progressive revenue sources," these battles are not likely to disappear any time soon.

    Durkan still derkin', but somebody needs to put Sawant in a small airtight container.

  • Dillinger||

    >>>"It is clear that the ordinance will lead to a prolonged, expensive political fight...

    Mayor Jenny and her Crew didn't foresee a fight on a unanimous jobs tax?

  • Rich||

    "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," reads Monday's statement.

    "And the obvious outcome of that fight -- well, that will also do nothing to tackle our crisis, not to mention my re-election."

  • widget||

    "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."

    There is no homelessness 'crisis'. The gutter punks and crusties don't want homes.

    https://en.wikipedia.org/wiki/Gutter_punk

    This is a lifestyle choice for many, mostly white folk. They should be free to give it a try if they please but taxpayers have no obligation to make this lifestyle easy for them.

  • Consigliere of the Dark Ones||

    Another name for a head tax: poll tax.

  • ThomasD||

    No, a poll tax must be paid in order to vote. Pretty sure that's not the case in Seattle.

  • BYODB||


    "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," reads Monday's 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."


    Or, in other words, it's not because we're wrong it's because you Neanderthals are too stupid to know what's good for you...


    All the pushback was enough to prompt Durkan to float a compromise head tax of only $275 per employee per year, which would have raised $47 million annually. This saving measure proved ineffective at quelling the passions stirred over the tax.


    ...and there's the proof.


    Honestly, the most surprising thing about this whole kerfuffle is that this didn't have much of a chance even in one of the biggest bastions of progressive idiots in the entire country. Impressive. Yet, you will note, that didn't stop the masters of the people from pushing it into law over the objections of the sheep.

  • BYODB||


    His union brothers shouted down pro-head tax city councilmember Kshama Sawant at one of her anti-Amazon rallies.

    Also, as a pure laugh riot, it never gets old watching the actual working class shout down an actual socialist politician. Even better when the socialist politician ignores the working class. Hilarity always ensues, as long as you have a twisted sense of humor.

  • Rhywun||

    Feh... most of those "working class" union types earn more than you or I will ever see. Decades of machine politics have seen to that.

  • BYODB||

    Yeah, this is true but it doesn't diminish my amusement. Socialist leaders will either eat the populace or be eaten by them.

  • josh||

    "Councilmembers who said they agree w/ big biz tax to fund affordable housing now want to repeal Amazon Tax coz blatant lies by big biz have impacted public opinion"

    Shame on big biz. Always lying about the laws of economics.

  • chemjeff radical individualist||

    I am glad that the city council finally came to their senses.

  • dpbisme||

    I did the math when this came up the first time and found that Seattle was spending $17,000 per homeless person for homeless people......and found that Seattle Spends I think 147 million on the homeless. I am sorry built there are places in this country where you could rent them a house, pay all their food, and utilities for that amount. This just proves how out of touch with America LIBTARDS are.

    I would put these people on a bus and send them out to their NEW country homes and then have a nice clean city.

  • Red Rocks White Privilege||

    If you want to kill smaller cities and towns in the US, dumping the homeless population of large urban areas on them would be a very effective way to do so.

  • Sevo||

    "If you want to kill smaller cities and towns in the US, dumping the homeless population of large urban areas on them would be a very effective way to do so."

    Agreed. Freeloaders simply need to be cut off the handouts; those who are capable will get the point.
    Regarding those who are incapable (and they are there), I don't have a problem helping out (which does not assume I have no problem grabbing your wallet to do so).
    What is not at all evident in SF ($241M/annum to attract bums) is any effort at triage at all. If you claim to be homeless, you get the goodies.

  • Rockabilly||

    fucking communists are all fucked up

  • CallMeDigitalBob||

    I personally don't wish to be taxed so Seattle can enable heroin addicts.

  • XM||

    I can't envision any scenario in which businesses would heartily support the tax.

    Mcdonlads and Starbucks would have to pay 275 bucks per every (new?) employee. They wouldn't be able to find franchisees to set up locations in Seattle. For a city with less than a million people losing businesses like Amazon was not an option. And these companies could just simply move to the next town over.

    The socialists in Seattle undoubtedly noticed that LA voters recalled Josh Newman over his support for the gas tax. He lost by a comfortable margin in a low turnout election. They were smart to ditch what might have been a distracting issue for democrats in November.

  • David Nolan Michael Hihn||

    Best spam post ever.

  • Sevo||

    Well, the best other than a Hihnfection.

  • LDRider||

    The sheeple roared. How unusual.

  • Sevo||

    I think it was Amazon.

  • vek||

    Thank god! I still live in this socialist hell hole for now, and it makes me feel warm and fuzzy inside to know that there is at least SOME LIMIT to the level of stupidity that the commies around here will put up with.

    My favorite line from the article:

    "...tweeted out Sawant who says she was left out of the loop on the decision to ditch the head tax."

    The other lefties on the council wouldn't even talk to her to tell her they were going to ditch this shit! LOLOLOL I hate her so much. I hope she literally breaks her neck getting out of the shower or something one of these days. She deserves it.

  • flashgordon||

    Wow, these people stepped back from the brink and stepped away from Seattle becoming Venezuela. I still haven't seen a good reason why seven people so dramatically changed their minds. I'm guessing Amazon or Microsoft or both promised them they'd have 10,000 less jobs in Seattle in 5 years if the law stayed in place.

  • Anacreon||

    When the Cascadia Fault rips loose, I move that we should rename it the Cascadia Cure.
    I have instituted a regime of incantations and imprecations imploring it to move to Californica (not a typo) thereafter.

GET REASON MAGAZINE

Get Reason's print or digital edition before it’s posted online