Council suspends action on proposed Seattle jobs tax

May 12, 2020
Written by wpengine

The Seattle City Council has temporarily suspended consideration of emergency legislation that would place a payroll tax on 800 Seattle businesses, according to a Seattle Times report.

Some Councilmembers have expressed concern that consideration of the tax is out of compliance with Governor Jay Inslee’s coronavirus “Stay Home, Stay Healthy” order that prohibits the Council from meeting in person or remotely unless the meetings are in response to the outbreak. The Council has twice met remotely about the proposal.

The decision by Council President M. Lorena Gonzalez and Councilmember Teresa Mosqueda at least stalls further consideration of the idea. Inslee’s Stay Home order is currently set to expire on May 31.

Councilmember Kshama Sawant, a sponsor of the proposal, said the tax could raise $500 million a year and that some proceeds could be directed toward affordable housing and relief to needy families. She has raised the possibility of seeking a public referendum on the idea.

The legislation would impose a payroll tax on Seattle businesses with 2019 payrolls of $7 million and above. Mayor Jenny Durkan and other opponents of the tax said it would discourage companies from hiring.

The Governor’s Stay Home order forced many businesses to close to curb the spread of the virus. The reduced economic activity has reduced tax revenues to municipalities throughout the state. It is unclear whether the Council will consider the proposal at a later date or whether Councilmember Sawant will seek to put the tax on the November ballot.