Council approves payroll tax

Aug 5, 2020
Written by wpengine

In early July, the Seattle City Council approved a payroll tax on companies by a 7-2 vote. Revenue generated will help the City cover COVID-19-related costs in the short term and to create affordable housing in later years.

Starting in January, the City will tax companies with annual payrolls of $7 million or more at rates ranging from 0.7% to 2.4% depending on salary levels and payroll size. The tax is expected to raise in excess of $200 million in revenue annually.

Concerned about the impact on Seattle’s economic recovery, Washington Retail, the Downtown Seattle Association, and the Seattle Metropolitan Chamber of Commerce opposed the payroll tax. They also believe that it will encourage companies to leave the city or not locate there.

Two years ago, the Council passed a $275 employee head tax on Seattle businesses, but it was repealed in less than a month due to strong public opposition.

The tax known as Jump Start Seattle contains a 20-year sunset that calls for the City Council to assess how it’s working.

Sources:, The Atlantic