Seattle officially repeals tax on companies like Amazon, Starbucks

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That was fast. The Seattle City Council voted to approve a $275 per employee per year head tax on May 14th.

This reversal on the head tax is an unprecedented move in Seattle politics.

"It's immensely disappointing", said Seattle City Council member Mike O'Brien, D, who voted for the tax before voting for its repeal. The city had initiated the tax just weeks ago, which imposed a $275 per employee cost on 585 businesses in the city.

Amazon and other large businesses pressured Seattle's city leaders to reverse and repeal a new tax on big businesses.

The tax, which is now scheduled to take effect in January 2019, amounts to $275 a year per full-time employee of the highest grossing businesses in Seattle.

The council struggled to conduct the vote at the meeting's conclusion as protestors chanted "stop the repeal", drowning out councilmembers as they attempted to cast their ballot. "But I would like to see leadership on the homeless issue from the CEOs of major employers as well as from political leaders". "They are desperate, and they are angry, and they have a right to be".

While a report by McKinsey & Co. said the region needed to double its funding for homelessness, in particular to build more affordable housing, Amazon and the business community said new city resources weren't necessary. The message gained traction with some homeowners, frustrated by the city's response to homelessness, in particular tents and RVs moving into residential neighborhoods. "When Amazon decides to be bullies and make this kind of threat, it's really hard for officials to know how seriously to take it".

Many anxious that Amazon and others would leave the city as the companies sharply criticized the tax as misguided. Amazon did not immediately respond to GeekWire's questions about whether it would commit to leasing the massive office complex now that the head tax has been repealed. Now, as voters seem less amenable to more property taxes, the support could be more important than ever-and the head tax fight risked straining that relationship.

Revenue generated from the tax was meant to help combat the city's homeless problem. Most of the rest would help fund homeless services, including emergency shelters.

The coalition is glad the "Seattle City Council has heard the voices of the people loud and clear and are now reconsidering this ill-conceived tax", said John Murray, a spokesman with the No Tax on Jobs campaign. The final nail in the head tax's coffin came yesterday when organizers for the "No Tax On Jobs" campaign announced they had secured more signatures than necessary. Starbucks and Amazon each kicked in $25,000 for the effort, and supermarket groups put in $80,000, according to the Seattle Times. "Together we must work to bring families inside, once and for all".

"It's great that the council is finally listening, and we look forward to working with them on real solutions to help solve the homelessness crisis", said Jasmine Donovan, Vice President and CFO of Dick's Drive-In. But to the mayor's progressive critics, Durkan gave up the fight too soon.

The council meeting before the repeal vote was raucous, with some public speakers decrying what they called a rushed capitulation without public hearings, and others in support of the repeal saying their uprising against the council was just beginning.

It's literally a matter of life or death for the people I work with. Unfortunately for activists who have been pushing for the head tax for years, there's no coming back from this anytime soon. "There's nothing but political tough decisions for cities trying to raise money", Auxier said.

But a one-night count in January found more than 12,000 homeless people in the Seattle and surrounding region, a 4 per cent increase from the previous year. Only L.A. and New York City have larger homeless populations than Washington state's largest city, Springer said.