Starbucks slams Seattle's new big business tax

Protesters attend the Seattle City Council finance committee meeting Friday May 11. The committee voted 5-4 to reject Mayor Jenny Durkan’s proposal of a more modest tax on large employers to address the city’s homelessness crisis.(Steve Ringman  The

It's lower than the $500-per-worker tax initially proposed.

Seattle's City Council approved the tax on businesses that gross at least $20 million per year in the city.

Amazon, which halted two major expansion projects in Seattle in protest over the larger tax increase, said it was disappointed even with the smaller tax package, although the company said it would restart the planning process for one of its new buildings.

The city's homeless population is growing, behind only NY and Los Angeles. "She is encouraged by the collaboration with Councilmembers and looks forward to Council's vote this afternoon", said Stephanie Formas, spokesperson for Durkan.

Durkan should have consulted a fellow former appointee of President Obama, Chicago Mayor Rahm Emanuel. Late last week, she put her support behind a $250 per employee tax. Kshama Sawant was the sole non-sponsor.

Proponents say people are dying on the streets, and while city-funded programs found homes for 3,400 people a year ago, the problem deepens.

When a council vote is 5 to 4 and a veto hangs in the balance, talk inevitably turns to "swing votes"-that is, who can be swayed to join the council majority to make the bill veto-proof?"

But the proposal itself had actually been reduced, with the initial pitch putting the tax at $500 per head, in order to pick up enough votes to pass and avoid a mayoral veto. However, Councillors have faced opposition from local firms who say that the tax will hurt their businesses.

"It's painful and it's embarrassing that we live in a city with so much financial prosperity and so many people without shelter", Lloyd David, executive director of the Polyclinic, a multispecialty medical clinic, told the council at a boisterous City Hall hearing where the council committee chairwoman admonished the chanting crowd and cleared the room at one point.

Without naming Sawant, Juarez offered a retort.

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Along with shrinking the head tax rate, the compromise also scales back a five-year spending plan for new revenue dedicated to housing and homelessness services. Seattle says it will get $47 million in new revenue from the tax, according to the Times.

Worker and church groups and others praised the tax as a step toward building badly needed affordable housing in an affluent city where the income gap continues to widen and lower-income workers are being priced out.

In the meantime, Amazon, Starbucks, and the other approximately 3% of Seattle businesses that will be dinged in the process have some time to start saving up. Well, by taxing businesses of course.

"It seems to me this debate is about the anger or fear at what the city is becoming", said Council President Bruce Harrell, who had to warn members of the crowd after repeated yelling and chanting during the proceedings.

However, the version of the tax that the City Council agreed to on Monday will be far less onerous than the draft that led Amazon to suspend construction on a new office tower in a not-so-subtle threat over providing further employment in Seattle.

While most the most dramatic moments in this saga unfolded over the last couple weeks, today's moment was months in the making.

On Monday, Seattle City Council had unanimously passed a controversial tax on big businesses to help the fund which are for providing affordable housing and fight homelessness to which Starbucks have given a scathing response on Tuesday.

The senator believes he can prove the head tax is illegal. That task force recommended $75 million through a tax on employers.

"We took a huge step a year ago", said Meg Olberding of HSD.

This is a developing story.

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