It’s been two years since local leaders declared a state of emergency for Seattle due to the homelessness crisis. Yet this year’s Point-in-Time count recorded 12,112 people experiencing homelessness. Last year, 169 people died while homeless. We are one of the country’s fastest growing regions, and one of the most expensive. This crisis isn’t going away.
Sadly, it wouldn’t have gone away even if the City Council had kept the Employee Hours Tax. (Also known as the Seattle "head tax" or the "Amazon tax.")
That's because Seattle sits in Washington State, which has the most upside-down, regressive tax code in the nation.
In this state, workers making less than $21,000 a year pay up to 17 percent of their income in state and local taxes. Middle-income people pay 10 percent. And those making upward of $500,000 pay less than 3 percent. The taxes we pay are a shared investment in things we all benefit from, like public schools, clean air and water, infrastructure, healthcare, and affordable housing—things that don’t come for free. This system works when we all chip in our share. But here in Washington, we ask those with the least to pay the most for these essential foundations, and we let those at the top off with a special deal.
The absurd inequity of our tax code isn’t a fluke.
Powerful special interests have spent decades and many millions of dollars manipulating it to serve themselves at the expense of the rest of us. They’ve riddled the tax code with wasteful tax breaks and loopholes. They’ve managed to ban the kinds of taxes proven to raise equitable, sustainable revenue—think of last year’s High-Earner Income Tax passed by the Seattle City Council and then struck down in court.
The effect is terrifyingly real: despite an economic boom, our state revenue is actually below Recession-era levels when adjusted for growth. Pushed into a corner with few other options, lawmakers are forced to raise resources through taxes that disproportionately impact those with the least to give—middle- and low-income families, small businesses, and many communities of color. An extra two dollars in sales tax doesn’t mean much to our local billionaires, but makes a world of difference to those earning the minimum wage.
With sky-high rents and the greatest inequality in our nation’s history, our state's tax code drives Seattleites into homelessness at a sickening rate. And, when the Seattle City Council turned to one of the few taxes they could legally pass, one that finally asked powerful special interests to pay just a fraction of their share, corporations spent hundreds of thousands to defeat the "head tax" and keep Seattleites sleeping outside.
Seattle’s homelessness crisis is the most visible manifestation of our upside-down tax code. But the code's effect is even more insidious, leaching into every facet of our lives from the McCleary decision to the opioid epidemic. As thousands live unsheltered, our loved ones die for lack of healthcare, and roads and bridges crumble, Amazon pronounces a 14-cent per hour, per employee tax that would only have affected the most profitable 3 percent of Seattle’s businesses “hostile.” What’s happening here in Seattle echoes what's happening now—and what will continue to happen throughout Washington—because of our tax code. Our communities, city, and state cannot survive this chokehold. So we need to clean the state tax code up, right now.
Despite our state’s constitutional barriers to an income tax—and Amazon CEO Jeff Bezos's opposition to an income tax—it is well known that income taxes are the key ingredient in an equitable tax code that adequately invests in communities. Still, even if Washington State won't allow income taxes, we’re not without options.
Lawmakers in Olympia should champion policies that end tax breaks for the wealthiest and invest new funds into solutions that support working and middle-income families, like an innovative state Earned Income Tax Credit. In the 2019 legislative session, I’ll advocate for ending the tax break on capital gains—profits from the sale of high dollar assets that are only accessible to the top one percent. You can join the growing movement: keep an eye out for All In For Washington meetings and events, and play our new online video game to try your hand at making your own tax code.
You can also make a difference by showing up for organizations leading local fights on the ground—the Transit Riders Union is one of many doing great work in Seattle. And don’t underestimate the power of testifying at town halls and catching your friends and family up on the issue. Trickle-down economists will squawk their false talking points until the middle class evaporates entirely, but it doesn’t take much for their myths to crumble.
As long as people sleep on the street, we are not thriving. As long as our kids go without basic school supplies, we are not thriving. As long as low- and middle-income parents are forced to choose between medicine for a sick kid and food on the table, we are not thriving. And as long as powerful special interests coerce us into maintaining our insufficient, inequitable, and upside-down tax code, we cannot thrive.
Make no mistake—big corporations used the “head” tax fight to make a statement to all of Washington: they have the power, and we must do as they say. But they don’t own us, and they don’t speak for us. We can ensure Washington thrives by cleaning up our upside-down tax code, ending wasteful tax breaks and loopholes, and asking the wealthiest to pay what they owe. And then, finally, we can start to bring our neighbors home for good.
Sumayyah Waheed is the director of the All In For Washington campaign, a statewide effort to clean up the tax code so it works for all communities, not just the wealthy and powerful.
