Seattle council rejects head tax on city’s largest businesses

The Seattle City Council shot down a controversial head tax on the city’s largest, most profitable employers Tuesday.

But that doesn’t mean Seattle is giving up on the head tax. The issue will return to the council chambers in the near future.

RELATED: Seattle businesses send letter to council in opposition of proposed tax

With a 5-4 vote, the council dropped the proposed tax on employees from the budget currently under consideration. That budget is slated for a final vote on Monday, Nov. 20.

The proposal — supported by council members Mike O’Brien, Kshama Sawant, Lisa Herbold, and Kirsten Harris-Talley — would have placed a $125 per employee fee on companies that earn more than $10 million annually. It was estimated to raise about $25 million a year. The revenue would have paid for homelessness programs and housing. The first version of the tax aimed for $100 per employee on businesses that earn more than $5 million annually.

On the other side of the issue, Sawant attempted to double the tax prior to Tuesday’s budget hearing.

Despite not passing the dais Tuesday, the council as a whole expressed support for the idea. It has committed to returning to the tax over the coming weeks, with the hope of addressing council members’ concerns. Some objected to the expediency in which the tax was pushed onto the budget. Other members felt it lacked transparency and needed to be crafted through a special committee. And some objected to the fact the money wasn’t strictly dedicated to be spent on specific programs.

Both council members Lorena Gonzalez and Sawant plan to propose resolutions on Monday, committing the council to passing a head tax on Seattle’s largest employers as soon as possible. Therefore, while this battle was lost Tuesday, the fight for the tax will continue.

RELATED: Bagshaw objects to Seattle business tax

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