Amazon balks at Seattle's proposed head tax

It started with a tax proposal related to the cost of fast growth. Now it’s become a showdown.

Amazon said it is halting plans for two downtown Seattle office buildings while it waits for the City Council to decide on a head tax.

That’s 7,000 jobs that are not going ahead in Seattle - hostage to city council's decision about the tax.

The tax would force big employers to pay the city of Seattle for each employee and every hour worked. The millions raised would fight homelessness and create affordable housing, according to the city.

Greg Johnson of Wright Runstad & Co. is the developer of one of the buildings involved. He says if Amazon’s job growth in Seattle were really to stop, that would change everything.

“Businesses start to become more cautious. Businesses start to pull back from investment. People stop hiring that next person.” Johnson said it’s not as though growth just tapers off. “Rarely does it plateau, it starts to go the other way and we get into a down cycle.”

Mayor Jenny Durkan released a statement saying she is concerned about the impact of Amazon’s decision on new jobs in the city. But she said the city has to solve some of problems of fast growth while keeping jobs.

In the last few days Amazon announced a total of 5,000 new tech jobs – for Vancouver BC and Boston. And other cities are throwing tax incentives at the company's feet to be the home of Amazon's HQ2.

Council meets to consider the head tax on May 14.