You know Amazon has been raking it in. What’s been less clear? How much the company pays in federal taxes.
Late last week, we got some answers. On Thursday, Amazon released its annual financial report, which includes its tax tallies. In 2019, Amazon paid $162 million in federal income taxes, with another $914 million deferred (to be paid, legally, at a later date). The $1.076 billion total trumps 2018’s figure of $436 million.
As the Seattle Times’s Benjamin Romano reports, that number also represents less than the federal corporate tax rate, which is now 21 percent. When that rate was 35 percent, some large companies dodged paying it in full by utilizing tax code loopholes and holding money overseas, among other tactics, according to the New York Times. (Amazon wasn't mentioned in the story.)
In addition to other federal and state taxes, Amazon forked over $276 million (with $8 million more deferred) in state income taxes.
The tax numbers can be found amid a flurry of more eye-popping ones: In 2019, Amazon reported $280.52 billion in revenue, up from $232.89 billion a year prior. For context, Microsoft reported less than half that amount in 2019, totaling $125.84 billion in revenue. The Redmond-based firm did top Amazon’s net income (basically, a company's profit), making $39.24 billion to Amazon’s $11.59 billion. But Amazon’s total is still notable given its history; as recently as 2017, Jeff Bezos’s brainchild reported less than a third of its 2019 net income.
Amazon’s financial news comes as the Washington legislature prepares for a Tuesday financial committee hearing about a bill to impose more taxes on big businesses in King County.
Unlike Seattle City Council’s famous head tax that was approved and repealed in 2018, House Bill 2907 doesn’t focus on revenue, instead turning its attention to employees’ salaries. At 51-plus-employee companies where at least half of the workers make $150,000 or more per year, businesses would be taxed between 0.1 and 0.2 percent on the incomes of those earning at least $150,000 annually. The potential $121 million in projected tax revenue could fund, among other things, affordable housing and services for the homeless.
The additional payroll tax would certainly affect the region's big tech firms, so it's safe to say leaders at Amazon, Microsoft, and other major King County companies should be keeping their eyes on Olympia this week.