A recent bill co-sponsored by Seattle representatives Drew Hansen and Gerry Pollet appears to be a multi-faceted offensive that could work in Microsoft’s favor. According to a report in the Seattle Times, Microsoft all but volunteered, as a company, to be taxed more in the state of Seattle.
HB2158-2019-20 subtitled: Creating a workforce education investment to train Washington Students for Washington jobs, was recently introduced to the House and is in Committee for a vote. The ultimate goal of HB 2158 is to fund the state’s “workforce education account” with a little over a billion dollars for the next four years, leveraging the fund to provide financial aid and additional degree slots for in-demand computer science and engineering programs among others.
Historically, Microsoft has been less than generous when it comes to opening up its pocketbook for tax-related expenditures. Like most companies, Microsoft has opted to exploited lucrative tax breaks to return as much profit to investors as possible, but it looks like this year, the company is pivoting for the sake of education.
Seattle Times writer Danny Westneat believes Microsoft’s newfound philanthropy could be a calculated move in public relations to spotlight its competitive neighbor Amazon. Westneat’s conclusion makes sense when looking at who the new bill would specifically target with the stipulated taxing regulations.
But here’s where this goes off the charts, into politically unheard-of territory. It mandates a top rate, a whopping 67 percent business tax increase, for those “advanced computing businesses” with “worldwide gross revenue of more than one hundred billion dollars” per year.
There are only two businesses headquartered here that fit that rarefied description. And one of them, Microsoft, is the tax’s biggest booster.
At a moment where Amazon’s corporate brand (non-Amazon Prime affiliation) is taking several PR arrows for the arguably bad HQ2 development decisions, Microsoft could theoretically be attempting to kick the company while it is relatively down. The Redmond giant could push a narrative that in its own hometown, Amazon is attempting to skirt its financial responsibility in giving back.
However, the less salacious posturing by Microsoft makes more business sense, in that, by allowing for more taxes, the company is indirectly paying for an educated workforce that will eventually be populating the halls of Redmond. The other benefit is that in Seattle, Microsoft could potentially leverage its historical contributions to the state to push a more pro-Microsoft curriculum equipped with Windows-based learning devices and Office 365 training.
These are just speculations, while the facts remain, Microsoft has volunteered to be taxed more for the sake of giving students interested in higher education an opportunity and support channel for the next few years. We’ll just have to wait and see if Amazon follows suit.Further reading: Amazon, Microsoft, Seattle Times, taxes