Companies such as Amazon and Starbucks will have to pay a levy for each full-time worker they have in Seattle. The city authority approved a compromise tax plan to fund services for those struggling to afford housing.
In a compromise reached in the Seattle City Council on Monday, approval was given for a yearly "head tax" charge of $275 (€230) for each full-time worker at the city's major companies.
The council approved the tax, which is expected to raise about $48 million annually to pay for affordable housing and services for homeless people. Last year the city spent $68 million on homeless services.
Nearly 600 employers with gross revenues of more than $20 million — including Starbucks and Amazon — will be expected to pay the charge in Seattle from next year onwards.
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A larger tax had been proposed and passed at committee stage on Friday by a close vote to charge $500 per full-time worker each year to raise about $75 million.
Ahead of the vote, the city's Mayor Jenny Durkan and four other councilmembers said they would only support a $250 fee, claiming a higher one would damage the city's business climate.
In response to the plan, internet giant Amazon threatened to stop work on a 17-story tower it was building near its South Lake Union district corporate headquarters.
People 'dying on the doorstep'
Co-sponsor of the charge, Teresa Mosqueda, said the bill was an opportunity to provide housing: "People are dying on the doorsteps of prosperity," she said. "This is the richest city in the state and in a state that has the most regressive tax system in the country."
According to its website, Amazon estimates its investments in Seattle from 2010 through 2016 resulted in an additional $38 billion for the city's economy and claims to be the largest private employer in the city.
Rapid economic growth in the city on the US north west coast has led to high rents and a rise in homelessness. Last year 169 homeless people died in the city, where winter temperatures can fall to minus 7 degrees. The Seattle region had the third-highest number of homeless people in the US in 2017.
jm/se (AP, LUSA)