June 12 (UPI) -- Less than one month after unanimously approving a tax on big businesses to generate funds to alleviate homelessness, the Seattle City Council on Tuesday repealed the bill due to fear of a referendum that would have reversed it.
The tax, often referred to as the "Amazon Tax" because the online retailer is the largest company in Seattle and would have paid the most, cost an extra $275 per employee each year. Amazon was a staunch opponent of the tax and funded a campaign to get a referendum to repeal it.
But it didn't have to go that far because the Seattle City Council voted 7-2 to repeal the tax.
Councilmembers said they had to repeal because the referendum was apparently so successful, the public would have repealed it.
"This is not a winnable battle at this time," said Councilmember Lisa Herbold, who voted to repeal the tax, the Seattle Times reported. "The opposition has unlimited resources."
In a statement, Amazon applauded the repeal.
"Today's vote by the Seattle City Council to repeal the tax on job creation is the right decision for the region's economic prosperity," Amazon Vice President Drew Herdener said.
The tax would have generated about $50 million per year, which would have been put towards affordable housing in a city that has the third-highest homeless population in the United States.
Councilmember Kshama Sawant, one of the two who voted against repealing the tax, said her colleagues showed "capitulation and betrayal."
"They are choosing to base themselves on making Amazon executives happy," Sawant said, according to The New York Times.