With just more than one week until the Seattle City Council votes on the head tax, tech leaders on opposite sides of the debate weigh in.
The city council says the head tax will mainly apply to businesses making over $20 million per year -- about three percent in Seattle. Those businesses would pay 26 cents per hour, per employee working in the city. Seventy-five percent of the money would go toward building affordable housing, with most of the remaining funds aimed at helping the homeless.
Michael Schutzler opposes the head tax. He’s CEO of the trade group, the Washington Technology Industry Association.
“It’s just a really terribly uncompelling argument,” he said, adding he thinks it will stifle job creation. “It’s easy for tech companies to expand to other cities.”
Ethan Goodman supports the head tax. He founded the group Seattle Tech 4 Housing, a grassroots group of tech workers supporting more affordable housing.
“It just makes sense, because we have large thriving businesses,” said Goodman. “Through the enormous resources that the tech boom has generated, what portion of those resources goes to some public good?”
While both agree Seattle’s previous city leaders are at least partly to blame for the city’s tight housing supply, Schutzler is more forceful.
“Abysmal management of this city is why we don’t have adequate housing, we don’t have adequate transportation,” said Schutzler.
Goodman added he believes tech workers’ high salaries are partly to blame as well.
“So much money, so little housing – prices just have to rise,” said Goodman.
Schutzler thinks tech workers get a bad rap when it comes to impacting housing prices.
“That high wage generates a lot of opportunity for a much wider swath,” he said, touting the economic impact of high wage earners.
Goodman argues that Washington state’s current tax system burdens low-wage earners.
“I think the most important background is Washington state has the most regressive tax system in the nation,” said Goodman.
Schutzler said he’s hearing from local tech companies who consider expanding elsewhere.
“We have lots of options, so if it becomes cost-prohibitive to expand in Seattle, it’s really easy to expand somewhere else,” he said.
Goodman doesn’t think the head tax will be a deal breaker for businesses.
“You see lots of business in the Bay Area, you see lots of business in New York, they’re willing to pay higher taxes to be in a high amenity area,” said Goodman. “They’re willing to pay higher tax to be in a place that their employees want to be in.”
The Seattle City Council is expected to vote on the head tax May 14.