Amazon Fires First ‘Shot’ in Shocking Tax War with Seattle

The Seattle City Council likes to eat it's bread winners, or bite the hand that employs the most people in the city.

On the heels of the highly controversial "head tax" being proposed, Amazon has now halted expansion plans and could likely look elsewhere for a new headquarters, possibly threatening as many as 7,000 jobs in the city.

The Head Tax is a fee of $500 per employee that would be paid annually by all large employers in the city, it's estimated about 600 businesses would be involved. But Amazon would shoulder the bulk of the bill. The money from the tax would reportedly be used to combat the city's exploding homeless problem. Well over 11,000 people are believed to be living on the streets as of the start of 2018. It's estimated at least 26% of the $75 million raised by the tax would be paid by Amazon.

Now, Amazon is threatening to stop construction of the 17-story corporate tower being built in Seattle, and pull back on other projects and jobs. It would have, according to the Seattle Times, a significant effect on the city economy. Many are accusing the City Council of making this a "tax Amazon" proposal, which the council denies. But controversial council member Kshama Sawant organized a "Tax Amazon" rally right outside their corporate headquarters.

The council will vote on May 14th about the tax, many business experts predict if it passes, Amazon will target Boston or perhaps Vancouver for it's project, often referred to as "HQ2" or second headquarters.

A head tax, or employment tax, is really nothing new. Chicago has had one, and years ago Seattle had a modest one that was repealed in 2009. But both of these were at least 2-3 times smaller than the one being proposed now.

Seattle has wasted millions of dollars and the city government shown it appears to have no clue how to deal with the exploding homeless issue, but it can thank former Mayor Ed Murray and others who publicly proclaimed the city as 'open and welcoming' to any and all homeless people.  Critics say the city left itself in a position where it can't back up it's promises. Skyrocketing rental and mortgage rates and costs are also adding to the problem.