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Homeless in Seattle to get help from city 'Amazon tax'

16 May 2018

Redfin CEO Glenn Kelman weighed in on Seattle's controversial new head tax Tuesday, offering a sober perspective amid vitriolic responses to the legislation.

SEATTLE is to tax big businesses such as Amazon and Starbucks to fight homelessness in the USA city. The tax is equivalent to $275 a year per full-time employee in Seattle and will raise around $48 million a year, which will be earmarked for services for the homeless.

UNIDENTIFIED PROTESTERS: (Chanting) No head tax, no head tax.

"Tax Amazon" was the battle cry for supporters of the measure, claiming the Seattle-based behemoth that employs thousands in the city is not paying its fair share.

In a statement released Tuesday morning, Starbucks Vice President Drew Herdener attacked the city for failing to practice fiscal restraint, and instead punishing businesses for what is ultimately the city's failure.

WATCH: Is head tax the right solution?

Kelman said Redfin, which became a public company past year, would support a Seattle tax on corporate or personal income but only after widespread re-zoning. The 17-story building, which will have 1 million square feet of office space, is meant to house between 7,000 and 8,000 new employees.

"We remain very apprehensive about the future created by the council's hostile approach and rhetoric toward larger businesses, which forces us to question our growth here", Herdener added.

"City of Seattle revenues have grown dramatically from $2.8B in 2010 to $4.2B in 2017, and they will be even higher in 2018". McKinsey came back with a report saying that if we really want to fix this problem, we need $400 million a year and that what's driving homeless is the lack of affordable housing. "We are highly uncertain whether the city council's anti-business positions or its spending inefficiency will change for the better".

She also said the city will take "urgent action to move people off our streets and into safer places and to clean up garbage, needles and waste from our parks and communities".

Starbucks is also angry: "This city continues to spend without reforming and fail without accountability, while ignoring the plight of hundreds of children sleeping outside", said Starbucks Senior Vice President John Kelley.

Aaron Mathews, a disabled veteran, says it's tough to navigate affordable or rent-controlled housing.

City leaders and tech CEOs should own it.

The council reached the decision after a weekend of haggling between council members and Mayor Jenny Durkan, who threatened to veto the originally proposed $500 tax per employee. However, it still does not support the compromise.

The tax affects some 600 businesses.

The council passed the tax, which takes effect next year, to address a growing dearth of affordable housing and expanding homelessness.

Seattle's building code is 745 pages long. A lot of people in Seattle have the image that Amazon employees are well paid, high-tech workers. Holland America Group's cruise lines (Holland America Line, Princess and Seabourn) will make 83 departures from Seattle this summer, contributing an estimated $225 million to the economy.

This has been one cause of the city's rapidly increasing rental and purchase prices for housing, gentrification and homelessness.

The company has been looking for a second USA headquarters, causing cities across the country to throw fawning events to court the huge retailer.

Homeless in Seattle to get help from city 'Amazon tax'