Seattle repeals corporate tax after Amazon flexes muscle
City had approved measure to raise money to fight homelessness
Seattle — Seattle leaders on Tuesday repealed a tax on large companies such as Amazon and Starbucks after a backlash from businesses, a stark reversal from a month ago when the City Council unanimously approved the effort to combat a growing homelessness crisis.
The council voted 7-2 after supporters and opponents packed a meeting with signs saying, “Tax Amazon, housing for all” and “No tax on jobs,” with some shouting for more time to discuss the issue.
The vote showed Amazon’s ability to aggressively push back on government taxes, especially in its affluent hometown where it’s the largest employer and where some have criticized it for helping cultivate a widening income gap that is pricing lower-income workers out of housing.
The tax was proposed as a progressive revenue source aimed at tackling one of the nation’s highest homelessness numbers, a problem that hasn’t eased even as city spending on the issue grew.
Businesses and residents demanded more accountability in how Seattle funds homelessness and housing and said it should take a regional approach to the problem. Many worried that Amazon and others would leave the city, with construction workers in hard hats packing City Hall to object to the tax.
Amazon, Starbucks and others sharply criticized the tax as misguided, and the online retailer even temporarily halted construction planning on a new high-rise building near its Seattle headquarters in protest.
Supporters praised it as a step toward building badly needed affordable housing. They said too many people are suffering on the streets and that the problem is deepening, despite city-funded programs finding homes for 3,400 people last year.
Seattle spent $68 million on homelessness last year and plans to spend even more this year, not counting the tax that would have raised roughly $48 million annually.
But a one-night count in January found more than 12,000 homeless people in the Seattle and surrounding region, a 4 percent increase from the previous year. The region saw 169 homeless deaths last year.