By Associated Press - Wednesday, July 1, 2020

SEATTLE (AP) - The Seattle City Council has taken a key step toward adopting a new tax on big businesses just two years after the council buckled under pressure from corporations such as Amazon and the prospect of a voter referendum and repealed a big business tax.

The council voted in a budget committee meeting Wednesday to advance a proposal expected to raise more than $200 million per year, The Seattle Times reported.

A final vote by the full council is set for Monday. The tax repealed weeks after it was adopted two years ago was expected to raise $47 million per year.

Dubbed “JumpStart Seattle” by lead sponsor council member Teresa Mosqueda, the new tax would target companies with many highly paid employees, whereas the 2018 “head tax” would have applied to all employees at large companies.

In last year’s council elections, five candidates defeated opponents backed by big business groups. This year, the coronavirus pandemic and protests against police brutality have created a stir in local politics.



Under the tax, companies with annual payrolls over $7 million would be taxed based on their pay to employees making over $150,000 per year. As amended in committee, the tax rate would range from 0.7% to 2.4%, with tiers for various payroll and salary amounts.

Wednesday’s vote was 7-2. Mosqueda was joined by council members Lorena González, Kshama Sawant, Tammy Morales, Lisa Herbold, Dan Strauss and Andrew Lewis. Alex Pedersen and Debora Juarez voted against the bill.

Mosqueda has proposed using the tax to underwrite $86 million in coronavirus relief this year, to buttress city services as Seattle emerges from the pandemic in 2021 and over the long term to pay for affordable housing, business assistance and community development.

Seattle Mayor Jenny Durkan has not yet taken a firm position on the business tax.

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