Seattle has one of the most regressive tax systems in the country. That means the people with the least amount of money pay the highest proportion of their income in taxes, while the richest pay the lowest tax percentage. But District 2 city council candidate Tammy Morales thinks she can change that.
Morales, who is running to represent a large swathe of South Seattle, is floating a round of six new progressive funding taxes that would bring in millions in tax revenue and be paid for almost entirely by big businesses or rich people.
“We can’t keep financing public services on the backs of working folks,” Morales told The Stranger. “I think we need to be looking for different ways to finance the work we need to do. What we are trying to lay out is a vision of how we can make this happen.”
The six new taxes—which Morales said are not meant to all be passed, but rather are for the new council to study and choose from—include citywide taxes on large inheritances, the sale of mansions, a new employee head tax, a tax on high salaries, a tax on companies that pay their CEOs excessively, and a tax on second homes.
Morales wants the new taxes to pay for a wide variety of local investments, from building affordable housing and fixing sidewalks to improving public schools.
Morales said that if she's elected she wants to have at least one of these new taxes proposed by the end of her first year. She said an employee head tax, which is paid by employers based on the number of employees they have, would be “A good place to start.”
The council unanimously passed a head tax in 2018 and Mayor Jenny Durkan signed the tax into law, placing a $275 per employee tax on large employers in the city to fund $50 million in homeless services a year.
But then Jeff Bezos, the richest man in the world and the founder of Amazon, threw a tantrum and threatened to stop building his latest tower. Around the same time, the Seattle Metropolitan Chamber of Commerce spent an untold amount of money on a secret Facebook campaign against the tax. The council and Durkan quickly repealed the law (and Bezos the billionaire quickly went back to building his tower).
“The fact that our council has already unanimously approved a tax on large corporations is really important,” Morales said. “It was reversed because there was at least a half million dollar campaign of misinformation that jaded the public on the idea.”
Morales’s opponent, Mark Solomon, said he would “need to study the details in more depth to say yes or no” regarding any of Morales's proposals, and he worried that her ideas are “setting up fights that we don’t need to have.”
Solomon said he did not want to bring back the head tax but that he does support a “state income tax, married with a reduction in property taxes and sales taxes.”
Voters had a chance to pass a statewide income tax via ballot initiative in 2010 but ultimately rejected the idea, so I asked Solomon if he voted for the 2010 income tax initiative. At first, he said he didn’t.
“I had not and the reason I had not is wanting to make sure that we had a reduction in the other taxes,” Solomon said. “I didn’t want to see an income tax on top of a property tax on top of a sales tax.”
When I reminded Solomon that the tax reduced some property taxes and was only on individuals who made more than $200,000, he then changed his answer.
“I do believe I did support that one,” Solomon said. “I did support that one.”
Morales said she voted for the 2010 income tax.
Current District 2 Council Member Bruce Harrell declined to run for reelection this year and Solomon and Morales were the top two vote getters in the August Primary. Solomon received 23 percent of the vote and Morales received 50 percent.
Morales has raised far more campaign contributions than Solomon—she has $169,949 to Solomon's $94,460—but Solomon has the help of the mega rich.
Two Super PACs funded by ultra-rich individuals and businesses—Tim Burgess’s People for Seattle (POS) and the Chamber of Commerce’s Civic Alliance For A Sound Economy (CASE)—have collectively spent $150,641 trying to elect Solomon. Morales has benefited from $12,486 in Super PAC spending from the labor-backed Civic Alliance for A Progressive Economy and SEIU Healthcare 775.
Did the chamber, the same rich people who paid to doom the head tax, get Solomon to change his mind on taxing the rich? He said he hasn't talked with the chamber regarding taxes.
“I have not had that discussion with those individuals,” Solomon said.
Solomon contended that the head tax is too politically toxic to be discussed again and ultimately unnecessary.
“I do believe there are other ways we can raise the revenue,” Solomon said. “One is looking at the accountability of money we are spending.”
When I pointed out that he was confusing how the city spends money versus how it raises money, and that no amount of "accountability" will "raise the revenue," Solomon said he supports creating a public bank and wants to raise money by bonding against future sales tax revenue.
Morales said if she is elected she will hit the ground running by studying these various taxes and then packaging the most viable options into a proposed law. She said it’s imperative that the next council raises future revenue from the richest residents while trying to reduce the tax burden for working class Seattleites.
“I moved here from New York City and we paid a citywide income tax and a state income tax [there],” Morales said. “I was making $8,000 a year more in New York and when I got my first pay check in Seattle I was making twice as much because of the regressive nature of our tax structure.”