(Amazon chief executive Jeff Bezos owns The Washington Post.)
In front of two dozen supporters holding placards reading “Tax Amazon. Fund Housing & Services” at a city hall news conference, Sawant said her proposed new measure would place a 1.7 percent tax on corporate payrolls. And the measure — as of yet unwritten — would tax the 825 biggest companies in Seattle, the top 3 percent as measured by payroll.
She estimates the tax would raise $300 million a year for the city. “I don’t expect Jeff Bezos to think of this as a good thing,” Sawant said. “But that’s where it matters what side you’re on. This is not a neutral issue.”
Amazon spokesman Aaron Toso declined to comment on Sawant’s proposal without seeing it.
Her announcement came in the wake of a charge she had violated the law by using her office to promote a potential ballot measure that would tax Amazon. Wayne Barnett, the executive director of the Seattle Ethics and Elections Commission, alleges that Sawant broke an elections law prohibiting the use of city facilities to promote ballot measures, as well as an ethics law that prohibits the use of city resources for non-city purposes.
Sawant said she was “disappointed” by the complaint. She said she’s been involved in developing the ballot measure in her personal time, as an alternative in case the city council doesn’t back her legislation. But she disputes that she should not use her position to help build grass-roots movement for the tax.
“I don’t accept that I cannot use my office resources to help build a movement,” Sawant said. “That is exactly what I’m supposed to be doing.”
Tech giants in both Seattle and Silicon Valley have been blamed for helping drive up the cost of living in their areas by bringing in thousands of workers with high pay and benefits, helping displace lower-income residents. Those complaints have resulted in a raft of announcements from Apple, Google and other companies that they’re spending billions of dollars to help create more affordable housing.
Amazon, which has more than 53,000 employees in the Seattle area, plans to open a homeless shelter in one of its newest buildings downtown in the coming weeks. The 63,000-square-foot shelter will sleep 275 people.
Sawant first pushed a measure in 2018 that required companies that generate more than $20 million a year in revenue to pay about $500 per job annually. Despite fierce opposition from Amazon and several other large corporations, the measure passed, and Mayor Jenny A. Durkan (D) signed it into law.
The tax would have raised $48 million annually to combat homelessness in Seattle, which ranks behind only New York and Los Angeles for the highest homeless population, according to federal statistics. The funds also could have been used to alleviate a shortage of affordable housing.
But the city reversed itself a month after passing the measure, repealing the tax after some businesses, including Amazon, funded a ballot challenge to overturn the measure.
Sawant’s new measure has not yet been written. And while she said she has spoken with other council members about the measure, none appeared with her at Wednesday’s news conference.
“I don’t think we should conclude anything from that. This is just the beginning of the discussion,” Sawant said.
Seattle Mayor Jenny Durkan criticized the proposal Wednesday. “Being progressive means actually making progress,” she said in a statement. “While slogans are nice, a failed, divisive fight that is high on rhetoric but low on outcomes, or one that funds lawyers instead of housing, is not an actual solution.”
One difference between the measure Sawant plans to introduce and the previous ordinance is that it won’t tax employee hours, which led critics to call it a “head tax.” Instead, Sawant wants to tax total payroll for corporate workers in the city.
Sawant’s measure may also have to contend with a bill the Washington state legislature is considering that would allow King County, where Seattle is located, to tax big businesses with employees who earn at least $150,000 a year to help fund affordable housing and homeless services. There has been speculation that the bill could ultimately include language that would preempt Seattle from imposing its own payroll tax.
To head off another tax battle, Amazon poured $1.5 million into a political action committee that opposed candidates who had supported the 2018 tax measure, include Sawant, a member of the Socialist Alternative Party. But Sawant won, and she now counts that victory as a mandate to push the Amazon tax proposal again.
“I have no doubt we have the mandate, but more importantly, elected representatives who got elected on a progressive agenda have a responsibility to deliver,” Sawant said. “The election, if it meant anything, what it meant was a referendum on who should run this city — big businesses or working people.”
Amazon has also faced criticism from Democratic presidential hopefuls, who often say the company has not paid its fair share.
“Right now, 500,000 Americans are sleeping out on the street and yet companies like Amazon that made billions in profits did not pay one nickel in federal income tax,” Sen. Bernie Sanders (I-Vt.) said during a presidential debate last summer.
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