Taxes

Seattle OKs Head Tax Aimed At Big Business

Seattle’s City Council passed a new tax for big businesses operating in the city, including Amazon, according to CNBC.

The tax, called the JumpStart Seattle Tax, will target businesses with at least $7 million in annual revenue. Those businesses will be taxed 0.7 percent to 2.4 percent, based on the amount they pay their Seattle-based employees, with tiers based on individual salary amounts above $150,000, with Amazon being in the highest tier at over $1 billion in expenses. Amazon will be taxed 2.4 percent for employees making over $400,000.

The money will go toward funding coronavirus relief at first, then toward housing and homelessness issues in the city, CNBC reported.

Councilmember Teresa Mosqueda called the passage of the JumpStart tax a “big step towards creating a progressive tax system that works for all,” according to CNBC. Her enthusiasm was not shared by Seattle’s business community, with criticism from the Greater Seattle Chamber of Commerce saying the tax would hinge on local businesses remaining strong, which is not a sure thing during the pandemic.

Amazon still has an expensive Seattle footprint, but it has moved in recent years to expand outside the city with an announcement in June that it would be leasing 111,000 square feet of office space in Redmond, along with an office in suburban Bellevue, CNBC reported. In Bellevue, the eCommerce giant is working on its tallest building yet, a 43-story tower.

The company did not comment on the JumpStart legislation, but CNBC posited that it could lead to Amazon seeking more office space elsewhere.

It’s not the first time Seattle has targeted Amazon with taxes. In 2018, the city taxed large companies to help with its housing crisis affecting the city’s working class. That legislation comprised a 14-cent tax per employee per hour worked within the city and ended up costing companies around $275 annually for each worker.

Amazon was on record opposing the 2018 tax, with Vice President Drew Herdener taking umbrage at the city’s “hostile” attitude and saying it would question its growth there.

——————————

New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.

TRENDING RIGHT NOW