City Council

Council Members Hold Heated Discussion on Head Tax

"That is never the discourse when it's everyday people's money, and it always seems to be the discourse when we talk about business."

By Hayat Norimine October 26, 2017

Seattle city council jan 28 2017 vsnz5l

By Wednesday's discussion of a potential head tax, it became clear it would be a stretch for the legislation to have the majority of council members' support. 

Council members Mike O'Brien, Kirsten Harris-Talley, and Kshama Sawant co-sponsored the bill that became the major talking point Wednesday during budget committee discussions—a 4.8 cent per employee, per hour tax for businesses with gross revenues above $5 million to fund housing and homeless services. That comes down to $100 a year per full-time employee, and would raise an estimated $24 million a year.

But most other council members have already publicly signaled they'd oppose the legislation that council member Sally Bagshaw said would be "sticking it to business" and "jamming it down businesses' throats."

Those words sparked a passionate speech on Wednesday afternoon from Harris-Talley, who said working people aren't granted the same considerations from lawmakers when their sales or property taxes rise.  

"That is never the discourse when it's everyday people's money, and it always seems to be the discourse when we talk about business," Harris-Talley said, adding that if the Supreme Court wants to rule companies as people, the same treatment should be granted with legislation. "It hurts my heart because it's unfair to the millions of people who are working day and night to stay in the city." 

Bagshaw said she's spent most of her career trying to end homelessness, but that the tax wasn't fair and shouldn't leave anybody out at the table.  

"You mean a great deal to me and I appreciate your heart and your being with us," Bagshaw said to Harris-Talley. "If I was indelicate earlier, let me try again...What I'm asking for here among my colleagues is to give each other a tiny bit of grace. Believe that we are all trying to reach the same outcomes."

Council members Debora Juarez and Rob Johnson also said they'd oppose the legislation as is, and Bruce Harrell at an earlier budget committee meeting showed he leans as a "no" vote and said he was skeptical the tax would "move the needle." Some council members opposing the tax criticized the bill for not putting businesses at the table and working with them collaboratively before rolling out the plan.

Another common criticism is that the tax uses gross revenues rather than net profit to determine which companies are being taxed, which is less progressive (though taxing based on net profit would have its own set of challenges, since that's information more difficult to gather from businesses). Both mayoral candidates also said they opposed the tax at a forum Tuesday night.  

That leaves three council members supporting it, potentially four with Lisa Herbold (who would likely be a more outspoken supporter if she weren't chair of the budget committee and trying to be a more neutral player), and five against.

But supporters say council members aren't proposing alternative solutions, and that the tax allows a longterm steady source of income. O'Brien said even the money offered by the head tax wouldn't be enough investment. 

"Council member Bagshaw, I am both so grateful for the work you do and yet frustrated by it at times," O'Brien said. "Sitting around the table and talking about more about this is not what we need right now. ...I just don't see why we should wait another day to do this."

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