‘Seattle Shield’ tax relief initiative heads to November ballot

SEATTLE - The Seattle City Council passed the "Seattle Shield" initiative, which would raise the business and occupation tax on high-grossing companies, while lowering the tax burden for small and medium-sized businesses. 

Councilmembers unanimously voted in favor of the initiative at a special meeting, and Mayor Bruce Harrell held a bill signing ceremony after its approval on Monday.

What is the Seattle Shield initiative?

By the numbers:

"Seattle Shield" would increase the city's business and occupation tax from $100,000 to $2,000,000, while raising taxes for the top 10% of highest-grossing businesses.

It was originally projected to bring in $90 million in revenue, but after multiple amendments were added to the initiative, it is now expected to bring in $80 million to help critical programs facing uncertainty under President Trump's federal cuts.

The city believes this could give tax relief to nearly 16,500 small and medium-sized businesses and that 90% of businesses would pay less than they do now.

What they're saying:

Nearly every public comment was in favor of the initiative at the special meeting.

"In Seattle, their impact goes beyond economics. These businesses contribute to the rich cultural and social fabric that makes our city unique. They create jobs, provide essential services and foster a sense of community that defines our neighborhoods," said Luzmila Freese, Director of Community Programs with Latino Community Fund Washington State.

The Downtown Seattle Association sent Fox 13 the following statement:

"The City of Seattle is collecting more revenue this year than at any point in our city’s history. Raising a B&O tax that is already the highest in the nation doesn’t solve the city’s self-inflicted spending problems. At a time in which we’re facing economic uncertainty, this measure sets up Seattle for more harm than good." 

In response to this vote, the Seattle Metropolitan Chamber of Commerce issued this statement:

"The city’s proposal gives needed relief to small businesses, something that we – and voters – strongly support, but we are disappointed that city leaders have also chosen to raise the B&O for many other hometown companies, making Seattle’s economic environment more volatile and uncertain. When business costs go up, consumer prices also go up, and we – and voters – also understand that. Finally, this tax package was rushed, including not taking into account the city’s revenue forecast, discussed just hours ago, which revises previous revenue projections up by about $90 million for the biennium. This policy choice simply misses the mark."

The bill, spearheaded by Councilmember Alexis Mercedes Rinck, will now be on the November ballot.

"Now, voters have the choice this November to give small businesses relief and help them stay open. These are the coffee shops where they get your oat milk latte just right, the family restaurants where they know you want 3 stars on your Pad Thai, the bookstore that has staff recommendations on what you should read next. In turn, this measure will ensure the largest corporations contribute more to safeguard our city and residents from the cruelty and chaos created by the Trump Administration and Congressional Republicans," said Councilmember Rinck.

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