Seattle Passes Spending Plan For $200 Million Big Business Tax

SEATTLE, WA — On June 6 the Seattle City Council voted 7 - 2 to pass JumpStart Seattle, a payroll tax on Seattle's business businesses which would raise hundreds of millions of dollars each year. Now, we're getting a better look at how the city intends to spend that money, thanks to a new spending plan unanimously passed by City Council Monday.

Jumpstart Seattle will be a new tax on corporations whose payrolls reach over $7 million annually. The tax itself is only applied to individual payrolls for employees who make more than $150,000 each year. Depending on how more much those employees make, their employers will be taxed between 0.7 and 2.4 percent of their pay. It is estimated the plan would raise roughly $214 million annually.

The tax will not go into effect until 2021, but it will have an impact this year regardless: as part of the initial proposal, $86 million will be given for coronavirus relief for small businesses, immigrants and refugee support programs, housing and food security. That money will then be replenished by the JumpStart Seattle tax raised next year.

The spending plan passed Monday outlines in more detail how that immediate relief money will be used, including:

• $36 million for rental assistance and shelter de-intensification.
• $18 million to support immigrant and refugee residents.
• $14 million for grocery vouchers.
• $18 million to support small businesses and childcare centers.

As stated above, that $86 million will be replenished by the tax next year, and city council says the remaining $128 million raised in 2021 will be used to preserve city services, supporting low income, homeless and immigrant residents.

The passage of the spending plan was lauded Monday by several city council members, including JumpStart's initial sponsor, Councilmember Teresa Mosqueda.

The spending plan also includes provisions for long-term spending once the pandemic has passed, identifying several social services which will require funding, the largest of which is affordably housing and housing security.

Monday's plan was hailed by Councilmember Kshama Sawant, who credited its passage in large part to outcry from the community.

"Today’s vote by Seattle City Council, along with the historic Amazon Tax victory earlier this month, represents the culmination of three years of determined, grassroots, rank-and-file-led organizing," said Sawant. "We have forced the City establishment to dedicate at least $18 million per year of the Amazon Tax revenues for publicly-controlled, permanently-affordable housing for Black working-class and poor families in the Central District, and dedicated funds for the Green New Deal and Tiny House Villages."

Despite the schism on how the tax should be approved, all nine councilmembers unanimously voted in favor of the spending plan Monday. Currently, the plan only exists as a resolution, but will provide the framework for further spending as the tax is implemented.