Amazon, Costco, Microsoft, Nordstrom warn Washington Legislature new taxes could cause corporate exodus

Alaska Airlines, Amazon, Costco, Puget Sound Energy, Microsoft, Nordstrom, T-Mobile, Redfin, Virginia Mason, Weyerhaeuser, Zillow, and even the Seattle Mariners were among the co-signers on the letter sent to Gov. Bob Ferguson, State Senate Leader Jamie Pedersen, House Speaker Laurie Jinkins, and Minority leaders John Braun and Drew Stokesbury.

The day before, Ferguson said he would veto any bill with a proposed wealth tax in any spending package after Democrats in the House and Senate approved budgets with the largest tax increases in state history to close a $15 billion budget gap caused by out-of-control spending.

The companies wrote in the letter, “These proposals would result in the largest tax increases in state history, perpetuating a dangerous trend of unsustainable spending growth. Over the past decade, the state operating budget has more than doubled, with a 37 percent increase in just the last four years. This growth far exceeds state increases in population, inflation, and personal income, threatening our economic stability."

The letter continued, “Given national economic trends, Washington state cannot sustain continued tax and spending increases and simultaneously maintain our economic resilience and competitiveness. Even with no new taxes, existing revenue sources are projected to rise by a healthy 6.8 percent in the 2025-2027 biennium and 7.7 percent on top of this in the 2027-2029 biennium. Given this, we believe it is a mistake to enact, as proposed last week, billions of dollars of additional tax increases with the apparent goal of growing tax revenue by almost 15 percent in the next two years alone."

The companies warned that jobs would leave the state as a result of the tax increases, noting that it is 30 percent less expensive to employ a software engineer in Vancouver, Canada than in the Puget Sound area and that Amazon moved jobs out of Seattle after the Emerald City passed the "jumpstart" payroll tax.

It was revealed last week that the tax came up $47 million short due to the exodus of companies from Seattle, adding to the city’s already astronomical $250 million budget gap, also caused by reckless spending. Before the tax was passed, Amazon warned city leaders that the implementation of the tax would cause them to leave.

The presidents of the Seattle and Bellevue Chambers, the Association of Washington Business, and the president of the Washington Roundtable also signed the letter.

Microsoft President Brad Smith told KOMO News, “Thirteen countries across Europe adopted precisely this type of tax in the 1980s, and almost all of them ended up abolishing it because they all had the same experience. This type of tax across Europe destroyed jobs.”

He added, "We can't ignore economics, and even in Seattle, Amazon has fewer jobs today than when that tax, that first payroll tax, was enacted, 10,000 fewer jobs, while in Bellevue, Amazon has added 25,000 jobs. I think the economics would make virtually inevitable the transfer of some jobs out of Washington State to Idaho, to British Columbia, to other states in the United States, that is what the experience in Europe showed there.”