
Seattle passes smaller ‘head tax’ on big companies after impassioned debate - derek
https://www.geekwire.com/2018/seattle-passes-smaller-head-tax-big-companies-will-compromise-appease-amazon/
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foolfoolz
> City of Seattle revenues have grown dramatically from $2.8B in 2010 to $4.2B
> in 2017, and they will be even higher in 2018. This revenue increase far
> outpaces the Seattle population increase over the same time period. The city
> does not have a revenue problem – it has a spending efficiency problem

~~~
jwilliams
That quote (from Amazon representatives) implies that revenue is non-linear to
population -- but that expenses should be linear. I don't buy into that view.
Especially in a "boom".

~~~
taurath
Meanwhile real estate prices have gone up 2-300% in the same timeframe, and
they are building light rail to deal with the gridlock.

~~~
adrianpike
Very slowly for many parts of the city - Ballard is looking at a 2030+
timeline to get a light rail expansion.

That said, it's better than nothing!

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megaman22
This seems a little silly - it's an irritation, but it's not big enough to
amount to anything really. If anything, it hurts lower-end positions more than
any other, since it's a flat head tax. If you're counting the beans closely,
it starts to make sense to hire 9 people with the salary you might have
allotted to 10, and so forth.

All this would really seem to do is piss off Amazon and Microsoft and the
other big players, which is kind of cutting off your nose to spite your face.

~~~
Scaevolus
Most Microsoft employees are in Redmond, which already has employee taxes at
$106.90/yr, or $0.056/hr for part-time work: [http://psbm.net/licenses-
taxes/redmond.html](http://psbm.net/licenses-taxes/redmond.html)

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pteredactyl
Sad to watch SF and SEA be the cause of their own slow-motion downfall.

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akhilcacharya
Where exactly do you expect business to go?

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darkengine
In the case of Seattle, Kirkland and Bellevue are host to quite a few small
and large tech companies already. The office space is plentiful and cheap on
this side of Lake Washington, and there is less of a worry of being hit with
poorly planned taxes and regulations that Seattle is, at this point, infamous
for enacting.

With the way the housing market is going, and the upcoming King County
property tax hike, I wouldn't be surprised if tech workers started creeping
out into Snohomish County and favoring jobs on the Eastside instead of Seattle
due to traffic.

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seanmcdirmid
The north and east side are the worst places to live in the Seattle area,
however, if you are young and without a family. It is very much like comparing
San Jose to San Francisco (I say this living in Bellevue and having grown up
in Bothell).

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NotSammyHagar
i think the east side is the best place to live, the worst place is sodo.

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seanmcdirmid
I don't know many young people that agree with that. Families, sure, east and
north side is better for schools and such, since it is basically suburbia.

Most of Sodo still isn't zoned for residential.

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NotSammyHagar
I have a family and live in the east side :-) I've seen it a million times,
people move to seattle, get an apartment, then couple up and buy a smaller
condo, have kids, need space, move to the evil eastside.

~~~
seanmcdirmid
Well, who knows what it will be like in the future. Seattle isn’t losing
population, some more suburban part of Seattle (e.g. West Seattle) are booming
also. It is possible that millenials will stay put and not migrate to the east
side.

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NotSammyHagar
my kid is almost finished with school, I might move to seattle after that.

~~~
seanmcdirmid
Seattle has ok schools. I have a toddler, currently living in Bellevue but the
thought of him going to school with a bunch of snobs is scary. Maybe move to
Mercer island instead :)

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mc32
So let me see if I understand this. Companies hire people, they become
successful and make their employeees successful (at least their non warehouse,
non call center employees) making the city and population at large successful;
growing the economy. For that good they get taxed more? It’s no wonder AMZ for
one is looking for an HQ2 location.

I know it makes people feel good, but honestly, the only answer to
homelessness is a federal approach. Piecemeal approaches tend to attract
people to homeless friendly places creating a positive feedback loop.

Why not go the whole hog and institute an “automation tax”. Tax companies for
every job they automate which leads to an unemployed willing worker, avoiding
the creation of a homeless pop. This would be less ridiculous.

~~~
NotSammyHagar
There's not a good way to get more revenue to cover the infrastructure needed
as companies hire more employees. We don't have income taxes here. If we did,
as you hire an employee you'd get more revenue to cover the fractional cost of
bus service, etc. A head tax is a way to do that. Are you against income
taxes? They could accomplish the same thing.

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whb07
Florida and Texas do not have income tax and yet they appear to not suffer
from the same ailments that the city of Seattle and SF are suffering from.

In a couple of years the city council will move to raise the head tax, stating
that their new record tax receipts are not enough to implement their working
solution. It is easy to spend money that isn't yours.

The city of Seattle has had record tax receipts for the past couple of years
and yet they somehow are always "short" on money.

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NotSammyHagar
Saying Seattle has record revenue is just a completely misleading thing to
say, without enough information. Your comment doesn't clarify anything about
whether Seattle is spending money poorly or wisely. Seattle's costs have been
going up, partly because lots more people have been moving here, and we don't
have income taxes, and businesses can hire more people without that leading to
increased tax revenue. The city has to build more infrastructure to handle us
(roads, transit, bike lanes, tunnels). There's no clear match between
infrastructure needs and revenue.

~~~
whb07
As you can see from the data[0] the city itself raises tax through a variety
of channels. The largest being property, business, and retail taxes. As you
can imagine, when the city grows all those enumerated taxes grow accordingly.
As you can see in data[1] the tax receipts for the years 2000 is roughly
$600ish million. For the 17-18 fiscal years, according to data[0] Seattle had
receipts of $1.1-1.2 billion.

So tax revenues for the city are close to 100% increase. If you see the Census
for the year 2000, the population of Seattle is at 564k. For the year 2016,
the population is at 750k or so. So a 100% tax revenue increase and a 50%
population increase. I'd dare say the city council is just belligerent with
other people's money.

Also, there is a legitimate far left socialist on the board. You should watch
the Shapiro debate against the Seattle $15 min wage. She's full of ideas with
no substance to back it up.

[0][https://sccinsight.com/2016/10/03/understanding-the-
seattle-...](https://sccinsight.com/2016/10/03/understanding-the-seattle-city-
budget-part-2-revenues/)

[1][https://www.seattle.gov/financedepartment/0102Adopted/City%2...](https://www.seattle.gov/financedepartment/0102Adopted/City%20Revenue%20Overview.pdf)

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akulbe
One question comes to mind... I wonder if this will result in more companies
allowing/encouraging remote work. Obviously, it won't work in every case. I
just wonder if things like this will push companies more in that general
direction.

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koheripbal
For a company with multiple locations, they'll just shift jobs to the other
locations. Working remotely has become very unfashionable in tech after many
studies showed that remote employees are very inefficient.

~~~
aioprisan
Quite the opposite: [https://hbr.org/2017/11/a-study-of-1100-employees-found-
that...](https://hbr.org/2017/11/a-study-of-1100-employees-found-that-remote-
workers-feel-shunned-and-left-out) [https://www.inc.com/farmers-insurance/do-
these-3-things-to-f...](https://www.inc.com/farmers-insurance/do-
these-3-things-to-foster-a-flexible-remote-work.html)

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propman
I'm fiscally conservative and I don't mind the tax, it's just very poorly
planned. $20M in revenue for businesses is not much. It's a regressive tax,
and it is appropriated to homelessness which the city has done a very poor job
of dealing with. Money will no doubt be wasted.

I do support a more fair tax in Bay Area that goes directly to transportation
and infrastructure improvement

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NotSammyHagar
Since we can't do income taxes in washington state, we can't make it a perfect
tax, which would be to tax rich software engineers more, and say construction
workers and baristas not at all. this tax would be better that way. They try
to limit it to people working at big companies. I think they should do
something like make it only for people making 100k or something. But would
that tip it over into an income based tax, probably?

So what's your idea for how to raise money to deal with homeless people. My
idea is copy what worked in Utah, which is start with building tons of
housing, enough for all the homeless people.

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rdlecler1
A $21/month tax on each employee. Feels like Amazon could swallow this and
might provide some incentive to hire outside the city core.

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drivingmenuts
Last I heard, they were shopping around to build a second Fortress of
Dar^H^H^H^H^H^H^H^H^H ... ahem ... HQ. Might this be incentive to accelerate
things a bit?

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mrep
I'm not really against the tax but its use. Spending more money on the
homeless giving them handouts is only going to attract more worsening the
problem.

I think the homeless problem should be tackled on a federal level since it is
easy for them to move states but not countries. Thus, any non-federal
government that spends tax revenue to help the homeless will likely just
attract more homeless people from other areas worsening the local populations
lives through the negative externalities and the costs which only reduce other
local governments homeless expenses.

~~~
NotSammyHagar
If that were true that we are making it too easy to live here in Seattle, then
consider Utah, which basically has provided housing for all homeless people.
They have not been swarmed with everyone moving there. I have noticed this has
not happened in Seattle :-)

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jeffbax
The amount of dumb things I hear coming out of Seattle lately blows my mind.
Every other city that wears it's "progressive"-ness on its sleeve should take
a wait and see approach to what Seattle does, so that when these terrible
policies do nothing to fix their problems and exacerbate others (like blaming
tech companies for housing shortages in SF) they can hopefully avoid it.

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gremlinsinc
Why not tie this to CEO pay... whatever multiplier the CEO earns (including
bonuses) above average workers is what they pay, so say it's 400x they'd pay
400 per head, if it's 200 they'd pay 200... Then the company just needs to pay
1 worker less money to keep more for the business itself and
shareholders/etc... Or the business could pay workers more to lower that 400:1
ratio.

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spacehome
Note that "help the homeless" and "reduce homelessness" are two different
goals and they are often at odds with each other.

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matte_black
How’re is this tax supposed to fix or ease homelessness?

Several years ago, some friends were looking to purchase a starter home in
Seattle, maybe for $250k or so. But they had such a killer deal on rent, they
opted to wait a few more years, _to save up more money_.

Well, in the next few years that dream quickly slipped through their fingers.
Now you have to pay upwards of $500k just to get some as-is teardown that
you’re not even allowed to look inside before you buy.

~~~
helianer
Well, taxing something means you’ll usually get less of it, so I guess it’ll
reduce demand on housing (probably not what they want since it hurts the
economy in other ways). If the money goes to building for those in need it
could help a bit.

The only thing that will really help over the long term is building even more
apartments.

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ryanmarsh
Shame on Amazon for hiring so many people in the Seattle area with good paying
jobs.

How dare people blame the poor and beleaguered city government for not solving
the city’s mental health problem. Record tax revenues? It’s still not enough.

Seriously though, isn’t this the deal? Business brings in good paying jobs and
pays taxes, city lays down the infrastructure to support commerce. With record
tax revenues the city government isn’t holding up their end of the bargain.

~~~
NotSammyHagar
Just noting that Seattle has record revenues, is notenough information to
understand if Seattle is doing a good job with it's tax revenue. There are
more people moving here all the time, so revenue will just go up (like for say
sales taxes). It's like saying the government always does a bad job, so the
govt. shouldn't do anything - that's just a general statement that doesn't
clarify anything. In this case, let's look at the costs and infrastructure the
city is facing and the number of people it has to deal with and try to
understand if the city's doing a good job or not. I haven't actually read
anything that did a good analysis of that.

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stuntkite
I agree that this tax probably won't fix the homelessness problem. Whatever
has happened to Seattle is much deeper then just homelessness. Amazon and the
like have ravaged the city of it's ability to provide functional housing even
to service and support workers.

I know this is happening in every city, but it's very pronounced in Seattle.
The city shuts down at 9PM because no one lives there and then the homeless
spill over into the empty well scrubbed streets.

It's soul has been sucked out and been replaced with techno culture. A weird
head tax is a reasonable ding for an exasperated set of natives, but someone
has to find a way to balance these concerns. Or not... I shudder to think of
what the bay, Seattle, Austin, Denver, Boston, etc are going to become without
all the people that make up a city that aren't just there to get their next
rung up on the way to be CTO for their own gig app.

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seibelj
Boston has a very active night life scene, as does Austin and SF... not sure
why you think these are ghost towns at night

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lovich
Eh, Boston is pretty dead by midnight, but there's not much open other than
bars. I lived out in the country and had a 24 hour pharmacy and supermarket
right next to each other but I never something like that in Boston proper

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stuntkite
Not quite what I meant. Sorry, I wasn't clear. I mean places that price out
culture for the tech scenes have some complicated issues with growth right
now.

