Councilmembers released a proposal to tax Seattle’s biggest businesses Friday, prompting cheers from the advocacy community that has been pushing the new tax for months.
The employee hours tax, if passed, would apply to businesses that gross $20 million, or roughly 3 percent of businesses in Seattle. Beginning in 2019, these companies would pay 26 cents an hour for each employee working in Seattle or $500 per employee, per year.
In 2021, the employee hours tax would end, to be replaced with a progressive payroll tax that would assess a higher levy on employees taking home bigger salaries compared with lower ones. The goal is to raise $75 million per year for housing and homeless services.
The proposal differs from that of the Progressive Revenue Task Force, a body created by the City Council after councilmembers failed to pass another version of the hours tax during the budget process. The task force eyed taxing businesses bringing in between $8 million and $10 million. Larger companies with more full-time employees would be assessed at a higher rate.
The proposal also dispenses with a “skin in the game” fee that all companies would have had to pay that had been contemplated at between $200 and $395.
Advocates believe that the housing and homelessness services system needs the influx of cash to combat a growing crisis. Businesses argue that they shouldn’t be targeted with more taxes.
Ashley Archibald is a Staff Reporter covering local government, policy and equity. Have a story idea? She can be can reached at ashleya (at) realchangenews (dot) org. Follow Ashley on Twitter @AshleyA_RC
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