The company will not be required to pay the standard 21 percent income tax rate on its 2018 profits, and is claiming a tax rebate of $129 million, which ITEP describes as a "a tax rate of negative 1 percent."
Amazon drew ire in 2018 for not paying federal taxes on its $5.6 billion in profits the year before, which was made possible due to tax credits and stock-based compensation, reports Politifact. Last year was the first time Amazon paid no federal income tax whatsoever.
From 2011 to 2016, Amazon payed federal income tax at a rate of 11.4 percent — less than half of the national rate of 35 percent. Due to President Trump's corporate-friendly tax cuts, Amazon will pay any deferred or postponed taxes at the lowered rate of 21 percent rather than the previous rate of 35 percent, per Politifact.
Based out of Washington state, which has no income tax, Amazon has also been free from state filings on income. Marianne Dodson
The Seattle City Council voted unanimously on Monday to impose a 2.25 percent income tax on the city's wealthiest residents.
Individuals making more than $250,000 and married couples filing joint returns earning over $500,000 would be taxed, with the city estimating the tax would bring in $140 million a year, which could be used to pay for transit and to lower property taxes. "We have an increasing affordability gap between the haves and have nots," Councilmember Lisa Herbold, co-sponsor of the measure, said. "The middle class is being squeezed as well. And one of the reasons is our outdated, regressive, and unfair tax structure."
Washington is one of seven states without a personal income tax, and Jason Mercier, director of the Washington Policy Center's center for government reform, told The Associated Press decades of case law show that a graduated income tax is unconstitutional due to income being property, and the constitution states that property tax has to be taxed uniformly and no more than one percent. Seattle Mayor Ed Murray said the city is ready for a legal challenge and "we welcome that fight," adding that if the city prevails, "it won't just be Seattle that's doing a progressive income tax." Catherine Garcia