Controversial Seattle ‘head tax’ may head south: Silicon Valley cities weigh tax on tech giants

From GeekWire:

Seattle is an innovator in a lot of things — from speciality coffee to cloud computing to commercial spacecraft.

Could that innovation now spread to municipal tax codes?

Seattle last week gained national attention after the City Council passed a so-called “head tax,” which levies a $275 tax per employee per year on companies with annual revenue of $20 million or more. The controversial tax, which would raise about $45 to $49 million, was applauded by affordable housing advocates, but criticized by members of the business and tech community, arguing that it amounts to a tax on jobs.

Now, the concept of taxing big corporations — in an effort to build affordable housing and offer homeless services — is catching on Silicon Valley.

Bloomberg’s Eric Newcomer reports that San Francisco, Mountain View, Cupertino and East Palo Alto are now considering similar taxes to the legislation passed in Seattle, potentially changing the dynamic between big tech companies and the communities in which they operate.

“Google has billions of dollars in cash floating around,” Mountain View mayor Lenny Siegel told Bloomberg. “They made billions off the tax bill. They can afford to spend a little more here.”

Google is headquartered in Mountain View, but also maintains a sizable operation in the Seattle area, with engineering offices in Kirkland (not subject to the head tax) and Seattle’s Fremont neighborhood (subject to the head tax). It has a market value of $746 billion.

Mountain View is considering a head tax of $250 to $300 per employee, with Bloomberg reporting that the city council is considering a vote for next month. It would raise about $10 million. Cupertino — home to Apple’s headquarters — also is considering a head tax to fund housing and transportation, as is East Palo Alto, which just voted to send the measure to voters this November....MORE