As unbiased grocers in Seattle, we’ve weathered many storms: a worldwide pandemic, provide chain disruptions and the lingering results of inflation. Our small companies are greater than shops; they’re neighborhood hubs the place neighbors join, and households depend on us for recent, reasonably priced meals.
However Seattle’s proposed Enterprise and Occupation tax enhance threatens to push our companies to the brink, forcing us to lift grocery costs at a time when Seattle households can least afford it. The Seattle Metropolis Council is predicted to vote to put the proposal on the November poll for voter approval.
We perceive that our neighborhood is already feeling the pressure of rising prices. We urge metropolis leaders to rethink this misguided coverage. Whereas we recognize town’s efforts to deal with price range challenges, this proposal, launched by Mayor Bruce Harrell and Councilmember Alexis Mercedes Rinck, is the flawed strategy. The politicians will say that they protected small companies by elevating the B&O tax threshold from $100,000 to $2 million in gross income. That may sound like reduction, however it gained’t assist excessive quantity, low-margin companies like your neighborhood grocery. For grocers like us, working on razor-thin margins, the elevated tax burden on our suppliers will inevitably trickle right down to our cabinets and our prospects’ wallets.
Including a tax hike that impacts our suppliers solely compounds the challenges we already face. Agricultural shippers and processors, crucial to our provide chain, will face greater prices underneath the brand new tax construction. These prices gained’t be absorbed by massive firms. They are going to be handed to us, the grocers and in the end to shoppers.
Our shops function on margins as little as 1%-2%. Not like massive chains, we don’t have the monetary cushion to soak up these price will increase. If our suppliers elevate costs to offset the B&O tax hike, we’ll haven’t any selection however to go these prices on to prospects. Households already scuffling with grocery payments, up 20% nationally since 2020, will really feel these will increase acutely. A current Washington State Food Security Survey, carried out by the College of Washington and Washington State College, discovered that meals insecurity charges have been considerably greater amongst households with respondents figuring out as Black (77%) or Hispanic (70%), indicating that this tax would disproportionately affect minority communities.
Town argues the tax hike will generate $90 million yearly to deal with a $251 million price range deficit and fund human companies. We assist investing in our neighborhood, however concentrating on companies in a means that raises meals costs for Seattle households is shortsighted. Seattle’s financial problem akin to excessive workplace vacancies, declining tourism and lowered shopper spending demand options that don’t burden important companies like grocery shops.
Our shops are the place neighbors meet and kids develop up. Elevating B&O taxes now, amid financial uncertainty, just isn’t the fitting strategy.
