SEATTLE — Mayor Jenny Durkan has returned the new Jump Start Seattle tax bill without signing it and she did not veto it.
The Seattle City Council passed the payroll tax Monday with a vote of 7-2. It was introduced by Councilmember Teresa Mosqueda.
In a letter to the city clerk, Durkan wrote the bill will likely have an opposite result in terms of increasing revenue for the city, as it will average $2,700 per job.
The mayor also stated that the city will need additional “progressive revenues” to overcome these unusual times and that the city needs to move away from a “regressive tax system to one that is more progressive.”
She also stated the middle class should pay less in taxes while affluent businesses and people should pay their “fair share,” but she went on to write:
“But this bill will not get us there, and ultimately will hurt Seattle’s ability to recover from the economic devastation caused by COVID-19.
“I regretfully cannot support this law in its current form. Council’s fast track approach to passing one of the largest taxes proposed in City history has led to serious concerns about not just the legality, size and scale of this tax, but its long-term impacts on the city and our small businesses. It is unclear what will be left of our economy when we emerge from COVID-19 next year. Right now, the very employers this bill seeks to tax are the ones that continue to employ workers and pay the majority of taxes to our city. The impacts of this bill on those employers and the economic impacts on our city will certainly be felt before revenue is collected in 2022 (or longer if there is litigation).”
Some business owners support the plan, while others say that raising taxes during an economic crisis could drive businesses out of the city.
The tax is expected to raise more than $200 million a year to help with affordable housing, small-business assistance and community development, but it will not be collected until 2022.
Click here to see the mayor’s full letter to the city clerk.
Cox Media Group