Hardballs
Hardballs DAVID RYDER/GETTY IMAGES

Amazon is making a big political statement. As the Seattle Times reports, the company will halt construction of a new office tower in Seattle pending the City Council's vote on a head tax on big businesses.

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The tech giant is also considering to sub-lease, rather than lease, space in another building under construction downtown. The message: Tax us too much, and watch new jobs disappear.

Council member Mike O'Brien learned about Amazon’s plans to halt construction during meetings with company representatives this morning, including Vice President of Real Estate John Schoettler and Eileen Sullivan, the Senior Manager for US State Public Policy.

"I asked Amazon if they’d be willing to engage in a dialogue about a fairer tax system in Washington State. They said they’d have to get back to me on that,” O'Brien said.

A city council visitor's sign-in sheet also lists meetings between Amazon representatives and council members Bruce Harrell and Lorena González.

During a Finance and Neighborhoods committee hearing to discuss the proposal, council member Kshama Sawant was the only council member to address Amazon's announcement, and she did so in stark terms.

"I think it’s critical we don’t accept this extortion," Sawant said.

The council proposal would tax businesses grossing more than $20 million a year 26 cents per hour per employee. Beginning in 2021, the employee hours tax would be phased out and replaced with a 0.7 percent payroll tax.

It would affect roughly three percent of businesses and bring an estimated $75 million to housing and homelessness services.

A spokesperson for Amazon did not answer questions regarding the company's specific concerns with the proposal.

In response to an email seeking comment on Amazon’s plans to halt construction, Mayor Jenny Durkan offered a statement expressing concern over the impact of an employer’s tax on jobs while maintaining the importance of addressing the housing crisis.

"In the upcoming days, I will be bringing together council members as well as business, labor and our community leaders to work together to see how we might forge common ground in dealing with our challenges while keeping jobs,” Durkan said.

A majority of council members continue to support the proposal. Council members Lorena González and Teresa Mosqueda, two other sponsors of the tax, expressed their support for it during a press conference with labor leaders this morning, just minutes after the Seattle Times story went online. During a phone interview, Mosqueda stressed that Amazon was invited to participate in a task force that played a central role in devising the head tax proposal, but declined the offer.

"It’s not accurate to say they weren’t invited to the table," Mosqueda said. "They were quite literally invited to the table."

The other sponsor, council member Lisa Herbold, also confirmed her continued support in an interview. Council member Sawant is a reliable vote on taxes on big business.