If you’re looking for some good news, here it is. This year, everyone from Washington Rep. Drew Stokesbury (R-Auburn) to Seattle City Councilmember Kshama Sawant agrees that addressing homelessness is a top priority. And, they agree we need a revenue strategy to get there.
But that’s pretty much where agreement ends.
Stokesbury wants to fund housing and services with a sales tax increase, but there are strings attached. Cities would benefit only if they outlaw safe consumption sites and prohibit homeless encampments within 500 feet of schools, parks and courthouses.
While this is mostly just posturing, that’s not the real problem with Stokesbury’s proposal.
According to a recent analysis by the Institute on Taxation & Economic Policy, Washington state already has “the most unfair state and local tax system in the country.”
We’re No. 1, with the highest tax burden on low-income earners in the nation, and the fourth highest on the middle class.
The bottom quintile of earners — whose incomes average $13,500 annually — pay 17.8 percent of their earnings in state and local taxes. The tax burden for those with average incomes of $33,300 — let’s call this the working class — comes in at 12.4 percent.
Compare this to the total tax rate for the top quintile — those earning $116,300 annually or more — which ranges from 3 to 7.1 percent.
That 3 percent rate is for the One Percent, which in Washington state means those earning more than $545,900, with an average annual income of $1,618,200.
Want to know why Tim Eyman’s demagogic tax initiatives keep passing? Look no further than this. The car tab tax revolt won’t be the last.
So an even higher sales tax, even when championed by an Auburn Republican, is pretty much a non-starter.
Which brings us to another non-starter: Sawant’s proposal to bring back the Head Tax, but four to 10 times bigger and more explicitly targeting Amazon.
Councilmember Lisa Herbold has said attacking Amazon isn’t the way to go, and the vast majority of City Council likely agrees.
But an absence of political allies has never stopped Sawant.
I get it. Amazon makes a great target. Jeff Bezos is the richest man in the world and the very embodiment of radical inequality. Despite his recent forays into philanthropy, he’s like a cartoon villain, complete with his own space rockets.
But we’re unlikely to get a progressive tax in Seattle by attacking the company that pumped $9 billion into the local economy last year and employs more than 55,000 Seattle residents.
The 2019 election was, among other things, a referendum on progressive taxation. But reading the results as a mandate to revisit the mistakes of the past is a bad idea. While Seattleites don’t want Amazon buying their elections or politically owning our city, we still love jobs and next-day delivery.
Maybe the silver lining here is that Sawant’s movement opens up political space for others. Most people in Seattle favor a progressive tax to scale up solutions to homelessness. The mayor, other members of the City Council and even the county executive are all said to be considering proposals as well.
While progressive taxation in Seattle will always be like threading a political needle, many approaches are possible. I like the idea of taxing portfolio properties that sit empty while they appreciate in value. We need to look at where uses of wealth violate community values.
Meanwhile, the time to push for another progressive business tax is clearly now.
History shows that there is no progressive tax that the Seattle Chamber of Commerce and their allies won’t hate. It hasn’t been that long since the chamber treated a modest latte tax like a declaration of class war.
Whether we attack Amazon or not, Seattle’s business interests can be counted on to fiercely oppose any proposal we bring. They won’t fight fair, and they’ll have learned from their mistakes.
We need to learn from ours as well.
Tim Harris is the Founding Director Real Change and has been active as a poor people’s organizer for more than two decades. Prior to moving to Seattle in 1994, Harris founded street newspaper Spare Change in Boston while working as Executive Director of Boston Jobs with Peace. He can be reached at director (at) realchangenews (dot) org
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