Economic study and business letter attack Seattle head tax

May 9, 2018, 7:25 AM
head tax...
A pedestrian walks past the site at right in Seattle where Amazon.com has halted construction planning on a new 17-story tower as it awaits a head tax vote from the Seattle City Council. (AP Photo/Ted S. Warren)
(AP Photo/Ted S. Warren)

Amazon has hit the pause button on projects affecting 7,000 jobs. An economic study commissioned by the Seattle Metropolitan Chamber of Commerce says a permanent halt will cost the city $3.5 billion in economic impact.

“All those lost wages, in terms for paying of houses, going to restaurants, going grocery shopping — those impacts all filtered down into where there’s just less money in the economy,” said economist Morgan, Shook of EconNorthwest.

That’s worrisome at Honda and Toyota of Seattle, where car sales generate $150 million in revenue a year, much more than the $20 million in revenue that triggers the head tax.

RELATED: 130 executives sign letter opposing head tax

“We’ve calculated it out and it’s $113,500 for the first year, with 227 employees. So, it’s approximately $9,500 in overhead that we weren’t anticipating,” said chief financial officer Stuart Lund of Honda & Toyota of Seattle.

That’s why more than 100 big-company CEOs have written to the City Council opposing the head tax. In a letter posted on the website Medium, they wrote:

“We oppose this approach, because of the message it sends to every business: If you create too many jobs in Seattle, you will be punished.

“We ask the City Council to set aside the misguided ‘head tax,’ and to engage us in more dialogue.”

The letter was signed by the CEOs of Alaska Air, Expedia, Real Networks and Tableau, among others.

Lund said the added expense will have him looking at employee head count. “It’s equivalent to two to two and a half employees just added on to our overhead.”

While the head tax money would go to fight homelessness, Shook says it may have the opposite effect on those at the low end of the job scale.

“There will be less of those jobs available to them and put some of those households at increased risk of economic insecurity,” Shook said.

But supporters of the head tax aren’t persuaded.

“I really don’t buy that argument. Again, this is a modest tax. We’re talking about the 3 percent largest businesses in the city, and this money is going to go into building new low-income housing,” said Katie Wilson, of the Seattle Transit Riders Union.

The City Council has an all-day meeting on Wednesday to begin discussing final plans for the head tax proposal.

By: Essex Porter

Local News

Election, ballot, polling...
Hanna Scott

New polling shows strong gains for Harrell and Davison, puts Mosqueda on notice

New polling from the Northwest Progressive Institute indicates that it's looking increasingly likely for a mixed outcome in Seattle’s general election.
15 hours ago
Seattle police, vaccine mandate...
Nick Bowman

SPD to terminate six officers over vaccine mandate, 103 await decision on exemptions

The Seattle Police Department reports that it has begun the separation process with six employees over the vaccine mandate for city workers. 
15 hours ago
Kshama Sawant recall, threatening emails...
Nick Bowman

Attempt to fast-track bill leads to heated back-and-forth between Seattle councilmembers

An attempt from Councilmember Kshama Sawant to fast-track a bill to require contractors to pay parking costs led to a contentious back-and-forth.
15 hours ago
Climate Pledge Arena...
MyNorthwest Staff

Climate Pledge Arena set for grand opening, Seattle Kraken debut

Climate Pledge Arena will open its doors for the first time under its new name this week, with a pair of concerts and the Seattle Kraken's home debut.
15 hours ago
Gadsden flag...
Nick Bowman

Police watchdog to investigate photos of SPD vehicles adorned with Gadsden flags

The Office of Police Accountability is opening an investigation into photos circulated on social media of SPD vehicles adorned with Gadsden flags. 
15 hours ago
religious accommodation...
Nick Bowman

Washington State Patrol terminates 127 employees over vaccine mandate

Washington State Patrol has terminated 127 employees in the wake of the newly-implemented COVID-19 vaccine mandate that took effect on Monday. 
15 hours ago

Sponsored Articles


How to Have a Stress-Free Real Estate Experience

The real estate industry has adapted and sellers are taking full advantage of new real estate models. One of which is Every Door Real Estate.
IQ Air

How Poor Air Quality Is Affecting Our Future Athletes

You cannot control your child’s breathing environment 100% of the time, but you can make a huge impact.
Swedish Health Services

Special Coverage: National Prostate Cancer Awareness Month

There are a wide variety of treatment options available for men with prostate cancer. The most technologically advanced treatment option in the Northwest is Stereotactic Body Radiation Therapy using the CyberKnife platform.
Marysville Police Department

Police Opportunities in a Growing, Supportive Washington Community

Marysville PD is looking for both lateral and entry level officers. Begin or continue your career in law enforcement for a growing, supportive community.

Small, Minority-Owned Businesses in King County and Pierce County Can Now Apply For $10,000 Relief Grants Through Comcast RISE

Businesses in King County and Pierce County can apply beginning on October 1, 2021, at www.ComcastRISE.com for a chance to receive a $10,000 relief grant.
Courtesy of JWatch Photography....
Experience Anacortes

Summer Fun Activities in Anacortes

With minimal travel time required and every activity under the sun, Anacortes is the perfect vacation spot for all ages.
Economic study and business letter attack Seattle head tax