The local government in Seattle, Washington has officially caved to Amazon in its efforts to implement a small tax on the city’s biggest corporations that would have helped fund housing for the homeless.

On Monday, Seattle mayor Jenny Durkan and seven members of the city council issued a statement stating that they would not seek to implement the tax they had just recently passed. Durkan argued the tax would lead to “a prolonged, expensive political fight over the next five months that will do nothing to tackle our urgent housing and homelessness crisis.”

If implemented, the so-called “head tax” — which would levy a $275-per-employee tax on corporations making at least $20 million in gross revenue — would have raised approximately $50 million per year to help the city construct more affordable housing as a means of alleviating Seattle’s homelessness crisis.

With 40,000 employees in Seattle alone, Amazon’s contribution to the tax would have been approximately $11 million. While that would certainly be a significant blow to a company making $20 million in annual revenue, the e-commerce giant made almost $178 billion in gross revenue last year alone.

Amazon

As the Seattle Times reported, the company lobbied heavily against the head tax, with company vice president Drew Herdener telling the paper that it was temporarily suspending construction on a high-rise building downtown, and evaluating options on subletting all of the office space inside another of its buildings on its 8.1 million square-foot campus — all in protest of the head tax.

The city council’s decision to not implement the head tax drew the ire of city council member Kshama Sawant, a member of the Democratic Socialists of America, who pushed for the tax as a solution to the city’s growing homeless population.

“Thousands of people are homeless and many have died this year already,” Sawant said at a rally on Tuesday. “This didn’t happen in a day or a year. The City Council has presided over [the homelessness crisis] for decades.”

A December report from the Seattle Times calculated that King County (which houses Seattle) had the nation’s third largest homeless population, with more than 11,000 people homeless on any given night over the course of the year. This put King County behind New York County (76,501 homeless) and Los Angeles County (55,188 homeless).

 

Logan Espinoza is a freelance contributor specializing in economic issues. He lives in Phoenix, Arizona with his wife and daughter. Contact him at logan DOT espinoza AT yahoo DOT com.

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