JOHN CURLEY AND SHARI ELLIKER

Curley: Seattle business tax would burden employees and shareholders, not CEOs

Oct 15, 2017, 4:10 AM | Updated: Oct 16, 2017, 12:01 pm

seattle, seattle business tax, amazon, john curley, curley, bezos...

Jeff Bezos (AP)

(AP)

Two Seattle City Council members want to tax Seattle’s largest businesses in order to help support services to aid the city’s homeless population. KIRO Radio’s John Curley says a basic economics principle dictates the money would not come out of the pockets of CEO’s, but rather from customers, shareholders, and employees.

Proposed business tax targets Seattle’s largest companies

Councilmembers Mike O’Brien and Kristen Harris-Talley have proposed a per-head tax on the number of employees for large companies in Seattle. The proposal, they hope, will aid in the city’s effort to combat homelessness. Under the proposal, any company that grosses $5 million or more per year would pay a $100 per-employee tax. This would apply to approximately 10 percent of Seattle companies.

“What I’m looking to do is ask the business community, especially those bigger companies that have benefited from this boom, to contribute to solving the problem for those that have been squeezed out by the very same boom,” O’Brien said.

Seattle’s largest company, Amazon, will have an estimated 70,000 employees in Seattle by 2019. A tax of $100 per worker would be a $7 million tax.

The math left Curley questioning where the money truly comes from.

“Who will pay that?” Curley said. “Where does (Amazon’s) $7 million come from? Where does Jeff Bezos get the money? It’s called incident analysis. It’s something that economists talk about when it comes to taxes. And it basically says, ‘All taxes are paid by people.’ That’s either customers, shareholders, or employees. All of them.

“Jeff Bezos is not going to write a check for $7 million to the city of Seattle. He will either take it out of the employees’ salaries, take it out of the shareholders’, or increase the cost to the customer.”

To study tax incidence is to examine which party pays the taxes placed on a company. Economists generally assume that the burden of any tax falls not on the company itself, but to other groups that make up the organization. According to Forbes, one possible effect of a corporate tax can be lower wages for employees or lower dividends for shareholders.

“Whether it’s Microsoft or Expedia or Nordstrom or Starbucks or Costco, all of these guys with all of these employees will pay these taxes, but the taxes are paid by either customers, shareholders or employees,” Curley said.

Supporters of the proposal argue there are ramifications of a boomtown like Seattle, and the proposal supports services to aid the homeless while also placing the burden on large companies, rather than King County taxpayers. Others argue companies like Amazon have been outspoken about helping to support their community, and that the company – which made $513 million in profit alone in the first quarter of 2016 — is unlikely to wince at the comparatively modest tax.

Also on the side of support are those who encourage wide-ranging efforts to lessen Seattle’s homelessness crisis. As of May 2017, the population of homeless individuals in King County alone had risen to 11,600 people, with nearly 6,000 of those people living unsheltered on the streets. The crisis has remained at the forefront of Seattle’s upcoming mayoral election.

John Curley and Shari Elliker on KIRO Newsradio 97.3 FM
  • listen to tom and curleyTune in to KIRO Newsradio weekdays at 3pm for John Curley and Shari Elliker.

John Curley and Shari Elliker

John Curley and Shari Elliker

Photo: Scott Fitzsimmons' "I-1THIS" license plate....

KIRO Newsradio staff

‘I didn’t even feel it’: John Curley shares astonishing story of local winner

The "I-1THIS" license plate is more than creative, it comes with a story of triumph. John Curley told the story who won the winning plate.

12 days ago

seattle nightmare tenant...

Frank Sumrall

Seattle homeowner’s ‘nightmare tenant’ situation resolved one year later

A Seattle homeowner's "nightmare tenant" situation, causing him to live in a van instead of his home for a stretch of time, has finally been resolved one year later.

13 days ago

curley dancing naked...

John Curley

John Curley’s life advice: Start your day by dancing naked to Andrea Bocelli

This has been a part of my regular morning routine for some time now: getting up in the morning and dancing naked every day.

14 days ago

...

MyNorthwest Video

Video: Let’s Talk About Eagles

John and Shari discuss the hatch watch for a bald Eagle named Jackie as she sits on her eggs. Then, the conversation goes in a different direction about snakes eating eggs and eagles eating cats. You want to listen to this one! Listen to the John Curley and Shari Elliker Show every weekday at 3pm […]

20 days ago

...

MyNorthwest Video

Video: Bradley Cooper Walks Around His House Naked

Apparently, Bradley Cooper walks around his house naked a lot. The John and Shari Show talks about their experiences growing up with their parents. Listen to the John Curley and Shari Elliker Show every weekday at 3pm on KIRO Newsraio 97.3 FM Listen to KIRO Newsradio 97.3 FM or go to MyNorthwest.com to learn more! […]

26 days ago

...

MyNorthwest Video

Video: The Naked Man Festival Is No More

If you had travelling to Japan for the annual Naked Men Festival on your bucket list… we have some bad news. After more than 1000 years, the festival has been permanently canceled. Listen to the John Curley and Shari Elliker Show every weekday at 3pm on KIRO Newsraio 97.3 FM Listen to KIRO Newsradio 97.3 […]

1 month ago

Curley: Seattle business tax would burden employees and shareholders, not CEOs