On April 20, City Council unveiled new draft legislation that proposed a 26 cent per hour tax for every Seattle employee of companies that gross at least 20 million dollars per year.
Essentially, the city would be collecting money based on how long these corporate employees spend at their jobs.
In response to the proposed measure, Amazon.com paused their construction on the new skyscraper being built in Rainier Square, which would hold 17 stories worth of new jobs added to the city’s economy.
The city’s intention behind the tax is to raise money for a new low-income housing project that would construct 1,780 apartments over the next five years, using the $75 million the legislation is estimated to raise annually.
However, the measure will cost Amazon alone more than $20 million per year, a huge number that has clearly already impacted how the company views its relationship with the city of Seattle.
Amazon has already indicated a slowdown in growth within the city of Seattle, as the company announced plans to expand its office holdings in Boston and Vancouver, B.C., in addition to its plans to establish a second headquarters elsewhere in North America.
The message sent by Amazon, in a rare political move, is one that should be taken seriously.
Councilmember Mike O’Brien acknowledged that “It’s obviously a little disconcerting when a major business says, ‘We’re rethinking our strategy here,’” as quoted by the Seattle Times.
The city council is not wrong in the intention to find some relief in the midst of one of the worst housing/homelessness crisis in the nation.
To accommodate the massive influx of jobs and prosperity that has been flowing into the city, Seattle developers have been adding upwards of 10,000 apartments per year. In turn with the high demand and deep pockets of incoming tech employees, rents have grown 64 percent since 2010, while the median price for a single family home has grown a shocking 110 percent.
This inflationary real estate market is having drastic consequences for those left out of Seattle’s tech boom, as the common dream of buying a house becomes only the millionaire’s privilege. With a record 169 deaths of homeless people reported last year, it is past time to start paying attention to the emergency situation Seattleites are living in.
There is no doubt that there is a deep wrong in our city’s homelessness crisis, however, a “tax on jobs,” as the Seattle Metropolitan Chamber of Commerce has dubbed the legislation, is not a solution.
Mayor Durkan stated in an interview that she is “deeply concerned about the impact this could have on a whole range of issues.”
Indeed, the fact that Amazon alone employs over 45,000 people in corporate positions makes keeping our city viable for growth crucially important. The jobs that are offered by these companies are well-paying, stable and encourage massive amounts of growth and prosperity in our city.
However, it is equally true that with this colossal influx of growth and development, there are disparities which have and will continue to arise. When confronting the income disparity, it is key to remember the goal of reconciling any marginalized group: opportunity.
The City Council has structured their effort at addressing issues within Seattle by creating more issues, a paradoxical philosophy that will end up hurting far more than it will ever help. By creating disincentives for major companies to continue to operate out of Seattle, the leadership will in turn kill the growth that is sustaining the city as a whole.
It does not make sense to punish those who bring in opportunities that we need. Rather, we ought to be focusing on creating incentives for everyone to continue to create opportunities for jobs, as well as give back to the community.
If Seattle wanted to see more corporate involvement in combating the most pressing social issues plaguing the city, they should be encouraging them to do so through incentives like tax breaks on charitable donations, preferences shown for companies who are involved in the community, and an emphasis on employee volunteer hours.
Discouraging companies to continue to expand in our city due to rising costs will not solve the homelessness crisis, and it will certainly not help the fact that Seattle as a whole is becoming too expensive. Abusing the city’s power to tax is not a just way to implement such change.
Taxes are not meant to be instruments of political influence; taxation ought to be regarded as a necessary evil to uphold the state for the greater good of society, however, they do not give the government unlicensed access to influence citizens by taking their property.
Seattle does need to address some critical areas within our social fabric, however, chasing away the aspects that allow this city to be prosperous will only create more problems, as it will jeopardize those who already have jobs without securing new ones for those who need them.
If the city wants to take charge, it needs to do so from a positive growth mindset so that everyone can have opportunity instead of a temporary and costly pseudo-solution.