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A proposed capital gains tax in Seattle draws mixed response from tech leaders and city lawmakers
- Seattle's City Council’s Select Budget Committee has discussed a new proposal for a 2% capital gains tax to contribute towards food and housing programmes for low and middle-income residents
- The proposal has received mixed response from the city's politicians, tech and business community with many leaders questioning the need for more revenue whilst the outcome of current spending remains uncertain
- The tax could impact tech employees and entrepreneurs with the Washington Technology Industry Association raising concerns.
- Potential impacts on migration and innovation are also unclear
- The tax would be implemented at a lower rate than the state capital gains tax, and limited to profits exceeding $262,000 per year.
- The tax would raise revenue for initiatives helping to pay for city residents housing, rent and utilities this year there is a $270m shortfall in the city’s general fund
- Income inequality has grown since the pandemic, with median wages for the city's tech workers reaching record highs last year
- Supporters of the tax believe the need to support vulnerable residents outweighs concerns amongst others about negative impact on businesses, innovation and migration
- Critics also have concerns about the outcomes of current spending
- If introduced, revenue will be collected starting in 2027
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