Kill the head tax

IN approaching its 2010 budget, the Seattle City Council should start with one assumption: The head tax has got to go.

We do not argue that an annual business tax of $25 per employee is a huge burden by itself. Of the two other King County jurisdictions that charge the tax, Renton charges $55 and Redmond, $90. But no business pays this tax by itself.

What counts is the stack of taxes. The total.

The business-backed Washington Research Council calculates that Renton levied a total of $79 per private-sector employee per year in business taxes and fees. In Redmond the total was $93, in Issaquah $156, in Bellevue $252 and in Seattle $484. These figures are for 2007, before Seattle piled on its head tax.

"We have three separate business-and-occupation taxes," says Seattle City Councilman Richard Conlin, who has joined with Councilman Tim Burgess to push for repeal. "We are the only city in the state with three," Conlin says.

The tax stack is one reason why job growth is slower in Seattle — though "growing" is not the right word. From 2000 to 2008, the number of private-sector jobs in Seattle shrank by 1.9 percent.

At the same time, the number of private-sector jobs in the suburbs grew by more than 10 percent.

Seattle, of course, has its attractions. Russell Investments just announced it was moving to Seattle from Tacoma, and it is unlikely the Russell folks forgot to inquire about Seattle's taxes. They also got a big discount on an office building.

Russell is a done deal. Seattle's future is not. It has to be attended to, so that Russell and everyone else here can have a shot at prosperity.

A $25 head tax is not only $25 too much, but, as Conlin says, "It sends a really bad message when we're trying to get people back to work."