Not long after they endured a stinging public relations firestorm over apparent discrimination by an employee that ended up being national news, Starbucks is back in the news, this time for unleashing what’s been called a “scathing criticism” of the Seattle City Council. The reason for the company’s ire? A recent tax increase on “big business” that has been earmarked to pay for “affordable housing” and to help house the homeless.
But Starbucks, a company that has long been known for taking strong stands on social justice issues, is not necessarily upset about the tax. Instead, the company is angry at what it calls a lack of accountability. In a statement, Starbucks senior vice president of Global Public Affairs & Social Impact John Kelly, said:
“This City continues to spend without reforming and fail without accountability, while ignoring the plight of hundreds of children sleeping outside. If they cannot provide a warm meal and safe bed to a five-year-old child, no one believes they will be able to make housing affordable or address opiate addiction. This City pays more attention to the desires of the owners of illegally parked RVs than families seeking emergency shelter…”
Starbucks’ message seems to be that the city doesn’t really care about the poor or the homeless, but, instead, is just trying to squeeze more cash out of successful businesses based in the city.
According to multiple media estimates, about 585 companies will fall under the auspices of the so-called “head tax,” which will tack on an additional tax for businesses making more than $20 million in the city. This isn’t a large number of Seattle’s business community — only about 3% — but it is a powerful and influential group, not only in the city but in the nation.
Not surprisingly, Starbucks was not alone in its complaints about the new tax. Amazon, another major Seattle employer released a statement calling the council’s decision a “tax on jobs.”
Amazon Vice President Drew Herdener’s comments about the new tax were not any more complimentary than Kelly’s: “The city does not have a revenue problem — it has a spending efficiency problem. We are highly uncertain whether the City Council’s anti-business positions or its spending inefficiency will change for the better…”
Starbucks, Amazon, and several other companies have made it clear that they believe they are better able to designate how and when their income should be used to support social issues. But that hasn’t moved Seattle Mayor Jenny Durkan, who, after promising to veto an earlier version of the tax bill, has agreed to sign this one:
“I will be taking urgent action to move people off our streets and into safer places and to clean up garbage, needles and waste from our parks and communities. At the same time, I want to create more accountability and transparency with taxpayer dollars. We will also continue to work towards a regional solution to homelessness because Seattle cannot go it alone…”
That part about “accountability and transparency” is likely something Starbucks and Amazon, as well as other taxpayers, will be looking for as well.
Ronn Torossian is a public relations executive with over 20 years of experience