
Seattle Poised to Repeal Tax on Amazon and Large Employers - petethomas
https://www.bloomberg.com/news/articles/2018-06-11/seattle-poised-to-repeal-tax-on-amazon-and-large-employers
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mrfredward
The real problem is the incentives the tax creates. It's per head, which means
every time you hire someone, your taxes go up, and every time you fire
someone, your tax bill goes down. It's a tax incentive for destroying jobs,
specifically low wage jobs held by the most vulnerable people, since the tax
is a drop in the bucket for executives, but much more significant percentage
wise when hiring low skilled workers.

It should have been a tax based on revenue, so that it targeted the financial
footprint of the company, rather than punishing companies for employing lots
of people.

~~~
bthrn
Wouldn’t a company’s taxes/costs go up with each new hire whether there’s a
head tax or not though? Social security for example is half paid for by
employers.

~~~
kd0amg
Payroll taxes scale down as the employee's pay rate scales down. This was a
flat amount per employee-hour.

~~~
drak0n1c
Exactly, the Seattle tax punishes low-margin employers of blue collar workers
much harder than it hits employers of high-salary white collar workers. It's
as if it were a carbon tax on labor designed to speed to adoption of
automation.

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kajumix
In other news, the mayor of New York "increased spending on homeless services
by about 60% since he took office nearly three years ago, reaching a historic
$1.6 billion this year." [1]

Despite (or because?) of the increase in spending in homeless services in NYC,
the number of homeless has increased significantly close to a high of around
76k on a single night in 2017 [2]

Is the Seattle plan [3] somehow different (aside from the dollar amount) from
that of New York?

[1] [https://www.wsj.com/articles/nycs-homeless-spending-
surges-t...](https://www.wsj.com/articles/nycs-homeless-spending-surges-
to-1-6-billion-1479676408)

[2] [https://patch.com/new-york/new-york-city/nyc-homeless-
popula...](https://patch.com/new-york/new-york-city/nyc-homeless-population-
grew-4-year-data-show)

[3] [https://3y7tq440s8xk37pci616zkly-wpengine.netdna-
ssl.com/wp-...](https://3y7tq440s8xk37pci616zkly-wpengine.netdna-ssl.com/wp-
content/uploads/sites/3/2017/08/Resolution-31810-Spending-Plan-V6.pdf)

~~~
drak0n1c
Free services accompanied by the relaxing of penalties on habitual rule
breakers (elimination of background checks, injection sites with free
supplies, regular vacation of all misdemeanors and gross misdemeanors,
limiting police patrols, obstruction of DEA and ICE) encourages more people to
move in from elsewhere. Measures that may have accommodated the original
homeless population fall apart with the massive influx, and the street
environment for the local lower and middle class worsens with all the new
opportunists.

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projectramo
1\. You should tax what you want less of.

2\. Tax should be evenly distributed

If you want jobs, don't tax jobs.

Amazon may be a large employer, but its not the only employer. Everyone should
be taxed in proportion.

What they should tax is land use per sf of lot (not sf of the building).

Now people who use a lot of land, or who use the land inefficiently, pay the
penalty.

It should also apply equally to everyone who uses the land from large private
home owners to small bookstore and cafe owners.

I know there is property tax on the value of the property, but that is a
different incentive (to build cheap). This is the incentive to use the space
efficiently. So use some amount per sf of lot (say $0.5? I don't know how much
that would raise).

~~~
chrisseaton
> 1\. You should tax what you want less of.

Do you think all taxes should be punitive? Are you against personal income and
sales taxes, and business profit taxes?

~~~
ghein
This was a descriptive statement. Taxes act like friction and DO reduce the
activity that they are attached to.

So if one is planning a tax regime, you should think long and hard about the
first and second order effects of your planned taxes. Unfortunately too many
in government and politics don't think about this.

~~~
rahimnathwani
"Taxes act like friction and DO reduce the activity that they are attached
to."

This is why it's interesting to consider taxes that aren't tied to activities,
or activities that are extremely resistant to change, e.g.

\- taxing land doesn't impact the supply of land, as (aside from melting ice
caps and land 'reclamation' projects) the amount of land on Earth is fixed.

\- taxing human existence (e.g. an annual per capita flat tax) doesn't impact
the number of humans

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mankash666
While sold as a tax for the homeless, we've seen over and again how $50M
entrusted to 6 people with little oversight really turns out.

This is the right move

~~~
FranzFerdiNaN
Bezos said he literally cannot think of anything better to do with his money
than waste it going to space. While his employees suffer due to lack of water,
air-conditioning and such. So no, its better to put the 50 million in the
hands of 6 elected councilors instead of a private corporation who is just
going to hoard it and waste it.

~~~
bluedevil2k
No, it’s not better to give the money to elected officials - they have no
incentive at all to spend the money wisely. When you’re spending other
people’s money, the incentive to do what’s best for the money disappears.

Further, when discussing politics, giving money to politicians leads to
corruption, kickbacks, and other waste.

Finally, politicians have shown time and again they are awful businessmen.
Boston’s Big Dig, Seattle’s tunnel under the city, California’s high speed
rail, and I could go on and on and on.

~~~
cat199
Time to play other foot shoe!

\---

No, it’s not better to give the money to corporate executives - they have no
incentive at all to spend the money wisely. When you’re spending other
people’s money, the incentive to do what’s best for the money disappears.

Further, when discussing business, giving money to businessmen leads to
corruption, kickbacks, and other waste.

Finally, executives have shown time and again they are awful businessmen. HP's
Itanium, Tharanos' nanotainers, and I could go on and on and on.

~~~
scarejunba
That usually works, but Jeff Bezos owns his company. The wealth he’s acquired
is his.

~~~
cat199
So, tax breaks which boost amazon profits are 'his', but taxing him is
'stealing'?

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squozzer
Not to pick on Amazon, but isn't Bezos someone who would support Seattle's
intent here? And how much would it have cost Amazon, considering their
revenues and the fact their Seattle workforce is ~10% of their total
workforce?

[https://www.seattletimes.com/business/amazon/amazons-
employe...](https://www.seattletimes.com/business/amazon/amazons-employee-
count-declines-for-first-time-since-2009/)

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madhadron
According the article, Amazon chipped in $25,000 towards the campaign to
repeal a tax that would cost it $12 million a year. That's an amazing ROI.

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aluva
As someone travelling though pioneer square every day I can see homelessness
is a problem.But I am not sure how the tax can help,lot of the homeless that I
encountered seems to be the under the influence of drugs and interestingly lot
of them recently moved to Seattle area.

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drak0n1c
A local partisan magazine, The Stranger, is a big apologist for this tax.
Similarly, it also supports carbon taxes for speeding up adoption of renewable
energy technology.

Perhaps the idea is to tax labor to speed up the adoption of automation
technology?

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intrasight
Kudos to Seattle for recognizing that they had made a mistake.

~~~
dathmar
I'm not sure if this is really the case. There was already an effort underway
to repeal this through a vote by the citizens. This seems more like the city
council heading off the vote to save face.

~~~
sitkack
> citizens

Amazon.

~~~
dathmar
Amazon might be the loudest employer, but they are not the only employer
impacted by the tax. The person leading up the signature drive isn't even an
Amazon employee: [https://www.linkedin.com/in/james-
maiocco-a9520](https://www.linkedin.com/in/james-maiocco-a9520)

This would be a vote by all Seattle residents to determine the need for the
tax. Are you saying that Amazon is going to somehow rig the election?

I'm just pointing out that it's interesting that the day after articles
started coming out that the signature effort was way over their goal of
getting this tax on the ballot for November election the city council decides
to vote on a repeal. [https://www.king5.com/article/news/politics/head-tax-
repeal-...](https://www.king5.com/article/news/politics/head-tax-repeal-
effort-well-over-signature-target-for-ballot-group-says/281-563174163)

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Simon_says
Somebody needs to tell these guys that if you subsidize something, you're
going to get more of it.

