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After Seattle Ditches Its Amazon Tax, Silicon Valley City Mulls a Google Tax

Employee head taxes are enjoying an undeserved popularity.

Bennymarty/Dreamstime.comBennymarty/Dreamstime.comAs Seattle repeals a literal tax on jobs, a similarly bad idea is taking hold further south.

Passed by a unanimous vote of the city council in May, the city's so-called Amazon tax, which imposed a $275 annual fee for every worker employed by a company grossing over $20 million a year, was on the books for barely a month before city elders nixed it, hoping to avoid a bruising voter initiative campaign that sought its repeal.

The move provoked howls of betrayal from some of the tax's most ardent supporters. Councilmember Kshama Sawant called the repeal a "shameless capitulation." One impassioned activist told the city council in a public hearing that "when it's our turn, we won't make excuses for the terror." Accusations like bootlicker were thrown around with liberal abandon.

Yet while the Amazon tax might be dead for now in the Emerald City, a Google tax is gaining steam in Mountain View, California.

Last week the Mountain View City Council gave its preliminary endorsement to putting an employee head tax on the upcoming November ballot. The proposal would levy as much as $150 per employee for firms that employ more than 50 people in the community.

This is projected to raise $6.1 million. Over half of that—roughly $3.4 million—would come from Google, which employs 23,000 people in the town.

The idea is to get Google to kick a little back to the town for the problems their growth has wrought.

"We want everyone to pay their fair share. We're asking for something that can begin to cover the impacts that we're seeing," one tax proponent tells the Mountain View Voice, comparing Google to a restaurant patron ordering the most expensive meal at the table and then slipping away to the bathroom when the check arrives.

"If we're lucky, some of the companies won't expand here and they will expand elsewhere, where the workers live," Mountain View Mayor Lenny Seigel says in the San Francisco Chronicle. (Seigel has previously described his town's problem as having "too many good jobs" and not enough transit.)

Seigel's hope is precisely the fear of many Mountain View businesses, who worry that they'll be the ones to suffer should Google decide to shrink its Mountain View workforce.

In a survey conducted by the Mountain View Chamber of Commerce, 54 percent of local businesses say that they oppose an employee head tax, with 38 percent in support and 7 percent undecided. If larger corporations skip town to avoid the tax, 62 percent of local enterprises say they would be negatively affected.

Similar uneasiness from the wider business community, along with unions and other city stakeholders who don't see economic growth as a bad thing, was enough to kill Seattle's head tax. Of course, the backlash there also had a lot to do with popular resentment toward a city government that people see as out of touch and ineffectual. Politics is presently less fractious in Mountain View, where a city-sponsored survey shows two-thirds of voters favoring an employee head tax.

The idea is catching on in a number of other Silicon Valley towns as well. Apple's hometown of Cupertino, like Mountain View, is mulling the idea of putting a head tax on the November ballot. San Jose, Redwood City, and Sunnyvale all have job taxes already.

Whatever their popularity, these taxes are bad ideas. They're predicated on the mistaken notion that thriving tech firms are growing at the expense of communities.

As opposition from the wider business community demonstrates, corporate behemoths are not hording all the growth to themselves. Other businesses benefit from their proximity to large corporate campuses and the customers they bring, as do the employees of those smaller businesses. Mountain View property owners are no doubt happy to see the value of their homes increase as a result of Google's growth in the town, even if they don't like the added traffic congestion.

The prosperity these companies bring, in short, is spread as widely as whatever negative impacts they might have.

Jared Walczak of the Tax Foundation says employee head taxes "are rare and for good reason."

Walczak thinks cities have legitimate concerns about the impact of large commuting workforces on their town's infrastructure. But the revenue projections for these head taxes are often based on the current levels of employment in the towns that are looking to adopt them. And as Walczak notes, "Tech firms tend to be mobile. The jobs themselves can be located elsewhere, whether that's down the street or across the country."

This is particularly true of companies like Google, which has large corporate campuses around the country. They would in all likelihood minimize the impact of a head tax by reassigning jobs elsewhere, just as Amazon promised to do in Seattle. When those employees go, so does the revenue the cities were going to rely on.

Photo Credit: Bennymarty/Dreamstime.com

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  • Pro Libertate||

    Move. People will go to where the work is.

  • Bubba Jones||

    None of the voters in Mountain View actually work in Mountain View...

  • No Longer Amused||

    You can just hear the exodus out of the cesspool of idiocy that is Kalifornia.

  • Hugh Akston||

    "We want everyone to pay their fair share. We're asking for something that can begin to cover the impacts that we're seeing,"

    I wonder what kind of tax incentives Mountain View offered Google over the years to set up shop and say in town.

  • Mike Laursen||

    Mountain View has never needed to incentivize high-tech companies to come there, since, historically, the city is where high-tech already is by default.

    The traffic around Google is really bad, but it's not clear how $150 / employee will solve the traffic problems.

  • JFree||

    I doubt the $150 has anything to do with either raising revenue or changing employer behavior. It's closer to the amount needed to put a bit of goose in the step of a parking meter maid

  • $park¥ leftist poser||

    This could very well be an indication that people are getting dumber. Maybe those IQ tests weren't necessary.

  • Leo Kovalensky II||

    The only innovation that government ever provides is in new ways to extract money out of its subjects. Thanks Seattle, for all of your innovation.

  • Mike Laursen||

    The video of the Cupertino city council trying to get freebies from Apple when Steve Jobs First presented plans for their new heasquarters is worth watching. It's a textbook example of what you're talking about, but Jobs puts them in their place very quickly by threatening to build his headquarters elsewhere.

  • Leo Kovalensky II||

    "We want everyone to pay their fair share. We're asking for something that can begin to cover the impacts that we're seeing," one tax proponent tells the Mountain View Voice, comparing Google to a restaurant patron ordering the most expensive meal at the table and then slipping away to the bathroom when the check arrives.

    In this analogy Google is the one that started the restaurant, hired the chef, made the table, and provided the previous 500 dinners... and Mountain View is bitching that they didn't buy them dessert.

    What would Silicon Valley be without all the silicon? Just a ditch basically.

  • Scarecrow Repair & Chippering||

    Orchards, like it used to be.

  • Sevo||

    An acquaintance did his history dissertation on the subject; they were all plumb orchards, but you couldn't ship plumbs at the time. They shipped prunes.

  • ||

    Y-you mean...they're parasites?

    I never!

  • BestUsedCarSales||

    Seigel has previously described his town's problem as having "too many good jobs" and not enough transit.

    Same problem me and friends were always complaining about down in the Holler.

  • H. Farnham||

    I watched the "we won't make excuses for the terror" video tweet imbedded in this blog post. Then I read the reply tweets... man, that's a depressing display of human thoughts. Surely that's not representative of even a sizable minority in Seattle???

  • Longtobefree||

    Surely
    it is.
    Why do you think they are so anti-constitution?

  • H. Farnham||

    I mean I've spent time in D.C. and other predominately leftist metropolitan areas. For the most part, people are generally alright and not completely insane, regardless of their political leanings. Some of what I've seen from Seattle is just kind of mind boggling to me, though. I guess I'd have to visit in order to get an actual sense of how things are.

  • mgseattle||

    Our City Council is kind of nuts (OK - completely nuts), but the traditionally left-leaning citizens including myself are beginning to have had enough.
    Next year, when seven of the nine council seats are up for election, will be very telling.

  • libertynugget||

    I used to think that too...
    Then I subscribed to Nextdoor to keep up with my neighborhood happenings... I'm pretty centrist (hence on a libertarian web site) but you'd think I was Newt Gringrich and Margaret Thatcher's love child compared so some of the things my neighbors post. I'd see them post some pretty left field stuff, then if anyone dared to retort, would 1. Gang up on them 2. report them 3. Claim that Nextdoor is not a place for political discussions that they themselves started....

    So for drama sake, i'm always looking for the posts that starts with some semblance of the phrase: "I'm not trying to be political and am not trying to start a debate but.... (chick fil a is homophobic boycott/ if you suggest that someone is casing your house and their a minority, you're just a racist/ whatever SJW topic of the day is)"

  • Rich||

    "when it's our turn, we won't make excuses for the terror."

    HATE SPEECH!

  • Ariki||

    As an outsider looking in, I wouldn't dismiss that mans words lightly.
    The American pot seems very close to boiling over.

  • Outside the Box||

    Look, I'm against this silliness as much as anyone, but the costs to Google of relocating people would be far more than a paltry 3M. It just isn't enough money to make a Google blink.

  • Ride 'Em||

    They don't have to move them all. Any expansion could be done by opening satellite offices and using technology. Instead of just distributive processing, there could be distributive employees. Then ten years down the road after the tax keeps getting raised the headquarters building is down to 10,000 employees. Headcount taxes are just like fines for "violations", they are easier to raise than property taxes as they don't directly affect most voters. California learned this year's ago, it is why violating speed limits cost so much.

  • Outside the Box||

    It is a minority, I assure you. Most people in Seattle work at places like Amazon and Google, it's the vocal minority of nutballs that presents this socialist extreme. You won't notice it on a day to day basis.

  • Sevo||

    First, Google doesn't have to move people; they can choose to offer moving costs or not. Secondly, they don't have to move far, just to a nearby city which isn't so idiotic. And then, it's not only Google, it's the next Google:

    "Employment tax in Silicon Valley city could spur small firms to move jobs"
    [...]
    "SmugMug has called Mountain View home for more than a decade, since it moved out of the founders' family home. But as the city considers a tax that would charge all but the smallest businesses an annual per-employee fee, that could change where the photo-sharing service plots its growth.
    Last week, SmugMug opened its first office outside of Mountain View in San Francisco. The 8,250-square-foot office at 390 Fremont St. is a home for its recent acquisition, rival photo app Flickr. The San Francisco outpost will have 25 to 30 employees, including some moving north."
    https://www.sfchronicle.com/business
    /article/Employment-tax-in-Silicon-
    Valley-city-could-spur-12992321.php

  • JFree||

    My guess is SmugMug is prob moving more BECAUSE of Google. No startup could remotely hope to compete with Google re local land acquisition or office space or the local stuff that every startup needs. Creates a unique hurdle for those startups - THEY are the ones who have to incur the expense of moving elsewhere. It's a big reason 'company towns' are notoriously anti-entrepreneur. They grow and die solely on that one company. Everyone else leaves.

    And maybe its one reason the newer tech generation is so 'centralizing'. Because the entrepreneurial mindset of Silicon Valley was built on fracturing bigger companies of their employee talent. When everyone in the bar works for the SAME company, that sort of networking is magnitudes harder and less effective.

  • Migrant Log Chipper||

    What the hey, Idiot Sawant must be sending out trolls to annoy the internet commentariat.

  • Earth Skeptic||

    Yeah, but the retards who work at those bigger companies are the same people who elect the city council, right?

  • Whorton||

    California and the left coast never cease to amaze. One hopes they enact their beloved tax. In fact, I would encourage them to increase the tax to $1000 a year. Everyone knows Google can afford it.

    In NO TIME, they will not have to worry about the problems as their city will rapidly become a ghost town, except for the possible exception of the mom and pop burger store. (Even McDonalds will flee at that rate!)

    They will be left with massive empty buildings that no one will occupy, and hopefully the idiotic management of Google et al, will begin to realize that progressives will turn on their own in a heartbeat.

    I honestly hope they stick it to those nasty robber companies that have the audacity to provide all those good jobs!

  • Earth Skeptic||

    You don't understand the socialist hipster dream, where nobody has an actual job, so no employers needed. Just endless days of drinking coffee in the morning and IPAs in the afternoon.

  • Ariki||

    "They will be left with massive empty buildings...."

    Homeless problem solved!

  • MyCroftxXx||

    Living in Detroit, i can say this is exactly what happens. city consul sees all of those jobs a "natural resources" that have always existed and always will. whats a dollar here, a regulation there to this immortal highlader Big bussiness. Nothing we could ever do could effect them.

    it's seems a lot like the climate change debate deniers. Nothing we could ever do could change the business climate.

  • Star1988||

    "The prosperity these companies bring, in short, is spread as widely as whatever negative impacts they might have."

    Maybe true. Maybe false. How would you know?

  • Sevo||

    "How would you know?"

    Well, how about comparing Mountain View's *total* city budget for 2018-2019 of $354.8M to Alphabet's 2017 net inc0me (not revenue) of $12.66Bn.
    So, yes, we can safely assume that Alphabet alone brings in tones more money than they cost Mountain View.
    See, wasn't that easy?

  • Whorton||

    California and the left coast never cease to amaze. One hopes they enact their beloved tax. In fact, I would encourage them to increase the tax to $1000 a year. Everyone knows Google can afford it.

    In NO TIME, they will not have to worry about the problems as their city will rapidly become a ghost town, except for the possible exception of the mom and pop burger store. (Even McDonalds will flee at that rate!)

    They will be left with massive empty buildings that no one will occupy, and hopefully the idiotic management of Google et al, will begin to realize that progressives will turn on their own in a heartbeat.

    I honestly hope they stick it to those nasty robber companies that have the audacity to provide all those good jobs!

  • Last of the Shitlords||

    Of course the other progs will turn on them. Sociopaths are incapable of real loyalty.

  • Johnimo||

    C'mon folks! Can't you see that taxes aren't high enough? These cities, counties, and states just aren't spending enough of our money .... yet.

  • Fuck you, Shikha (Nunya)||

    Where's the good reverend in this article extolling the virtues of his communism. I mean, it doesn't take much of a leap from here to his nirvana.

  • jedy mark||

    If people are willing to allow the government to violate their privacy, the government will.

    https://happywheelsnew.com

  • TeamsterX||

    The second you hear "fair Share'...you know it is a stupid idea.

  • Empress Trudy||

    Why not simply create a huge regulatory fee like GDPR which is little more than a tax.

  • eyeroller||

    It's funny that people only worry about national politics (which make up about 98% of the dinner table arguments), when local politics cause a whole lot more day-to-day misery.

  • JFree||

    If we're lucky, some of the companies won't expand here and they will expand elsewhere, where the workers live

    If that is really the mayor's goal - and it could well be; then this sort of tax is pretty good way of achieving it. The notion that the only solution to any town is to grow is obvious nonsense. Sometimes the answer is to shrink. If Google is actually employing 23,000 people IN Mountain View (popn 75,000), then I can see why they don't want their city to turn into nothing but parking lots for out-of-town commuters.

    Course if they really want to do that, then they should probably get serious and not just symbolic. Say $1000/employee for more than 1000 employees (would affect 8 companies) or $5000/employee for more than 3,000 employees (would affect only Google).

  • JFree||

    Just looked at employee data for some of these tech companies:

    Apple - 25,000 employees in SValley; 125,000 total
    Google - 20,000 employees in SValley; 85,000 total
    Tesla - 10,000 in SValley; 37,000 total
    Facebook - 9,400 in SValley; 25,000 total

    v older generation of tech
    Cisco - 16,000 in SValley; 73,000 total
    Intel - 8500 in SValley; 106,000 total

    x Intel - These are really a highly centralized company-town anti-diversity type mindset for companies that purport to effectively decentralize diversify other aspects of life. Never realized that but it explains a lot. When that high a % of employees face the same traffic jams, go to the same cocktail parties, live the exact same life everyday - what kind of diverse ideas can you really expect? Same prob the swamp is re DC/beltway.

  • dpbisme||

    So do LIBTARDS not know that the people employed by these companies pay taxes?

    They pay property tax (even if they rent)
    They pay taxes on the food they eat and the things they buy If they spend a dime it is taxed.

    In what alternate reality should companies that provide good paying jobs taxes beyond what they do now.

    DPB

  • Duelles||

    Growing up in Greenwich CT, in between Stamford CT and Westchester, NY I experienced the devasting tax effect on towns that attracted big business like Fortune 500 headquarters. They falsely thought these companies would increase the tax base and bring in more revenue. Perhaps they did, but the services and infrastructure demanded far outstripped the benefits. Westchester county and Stamford, CT property taxes are more than double the quiet city of Greenwich home to CEOs, hedge funders, Russian oligarchs, and working stiffs. While property prices may be high in Greenwich this can be offset by the taxes if one stays in their home long enough. I don't believe economics is understood by many including economists, and especially local officials.

  • flyfishnevada||

    Well, who approved the Google campus in the first place? Who approves massive housing developments, industrial centers and mega-warehouses? The same people that then complain they don't have enough roads, transit, water, etc., etc. City councils and county commissions. They are eager to bring jobs and tax dollars but when they don't spend all that extra cash, probably because they don't have it thanks to the massive tax breaks the offer to lure businesses in, improving the community, it's always someone else's fault. Hell, maybe they should offer to build the Warriors a new billion dollar arena to bring in more tax money so they can fix everything...LOL.

  • BILKER||

    I cannot understand how these underhanded, lying anti US people keep getting elected in Kalifornia. These socialist/progressive democrats torpedo their constituents repeatedly and the fools keep re-electing them. They all should be subject to the GVRO(G=GOVERNMENT) in this case since they are a serious menace to the public.

  • vek||

    Obviously I'm against such retarded taxes as a libertarian... BUT that said, the Bay Area, Seattle (where I live), and a few other techie hubs really almost DO need to put the breaks on growth.

    As a Bay Area native, and somebody who has lived in Seattle for 13 years now, the fact is the insanely rapid growth, and the fact that almost all of it has been in the 6 figure + income bracket, has genuinely ruined these places as good spots to live... That INCLUDES for all the techies, who have a standard of living comparable to people making half their income in most other places in the country. People who don't live in one of these areas seem to not be able to comprehend exactly what it is like to live in these places, and how it really has been too much of a good thing. This is evidenced by the types of posts many on here make.

    The truth is there is no proper libertarian market way of "dealing" with the issue, other than letting it work itself out over time... Eventually the boom will subside. But it does kind of suck between now and then. I've been waiting for YEARS for big tech to realize they're wasting billions of dollars on excessive compensation (they have to over pay employees because of the cost of living issues they themselves made), facilities, taxes, etc by being located in only a few crazy expensive cities.

  • vek||

    They really need to start opening campuses in more major cities across the USA. This is how ever other fortune 500 company runs their shit, I don't get why tech can't figure it out. It would be great for their bottom line, AND it would make it so that the positive benefits of these great jobs were not so overly concentrated that it actually turned it into a negative like in SF, Seattle, etc. It would be win-win-win for everybody.

    And FOR THE RECORD, the argument that every single programmer in the universe REFUSES to live anywhere that isn't a trendy coastal city is bullshit. I know countless, and a ton of them from the Midwest/South/Etc looked for decent jobs around where they grew up, and there simply weren't any. They would have been stoked to have remained in Cleveland or Atlanta getting paid $100K a year versus making $135K a year in Seattle and having to live in a shoe box sized apartment like a college kid still. They'd actually be able to live like civilized human beings in those other cities, and a lot of them KNOW IT. But the jobs just don't exist there, because big tech has actively decided to only setup in a handful of cities.

    This seems like it might finally be changing a little bit with some of them branching out... I certainly hope so. As shit lib as it is Seattle wasn't that bad a place to live before it really got overwhelmed by the tech growth here the last decade or so.

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