Seattle passes a smaller version of the ‘Amazon tax’

Nathasha De Alwis

A controversial proposal that will tax big businesses in Seattle to alleviate the city’s homelessness and affordable housing problems was approved yesterday (May 14). The Seattle City Council passed it unanimously in a 9-0 vote.

The final package, however, is almost half the size of the original proposal, which never garnered a veto-proof majority on the council. It was publicly opposed by Amazon, the city’s largest private sector employer, and 131 other businesses.

The newly passed ordinance, which takes effect in January 2019, will impose a “head tax” on the city’s highest grossing businesses. According to the Council, the tax will amount to $275 a year per full-time employee in Seattle. It would raise an estimated $44.7 million a year and expire after five years.

That’s down from the $75 million a year the original proposal would have generated by imposing a $540 head tax per employee for the next few years, after which it would be converted to a 0.7% payroll tax.