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Seattle Mayor Bruce Harrell released his (PET) report for 2024 on Tuesday and its projections came up nearly $50 million short.

“Today’s announcement that PET revenues collected in 2024 were $47 million lower than projected requires action to ensure our budget remains balanced,” Harrell explained in a statement.

Harrell said that his 2025 budget proposal was based on the projections from the independent Office of Economic and Revenue Forecasts. But since they got it wrong, the mayor said for the 2026 budget, “my office will consider all options, including additional revenue sources and appropriate expense reductions, to ensure we are making the priority investments and funding the essential services that matter to our residents.”

Chamber of Commerce: ‘No one should be surprised’

The Association of Washington Business, Bellevue Chamber of Commerce, Seattle Metropolitan Chamber of Commerce, and Washington Roundtable released a joint statement, saying the numbers are as expected.

“No one should be surprised that Seattle’s payroll expense tax is exactly what economists said it would be: volatile – because it is tied to the stock market, unpredictable – because businesses are making decisions on how to keep their payroll costs down, and precarious – because it intentionally relies on a small group of businesses that can easily move employees to a more welcoming environment.”

Did the payroll expense tax push jobs out of Seattle?

The payroll tax is levied on large corporations in the city, like Amazon and Expedia. Such a steep revenue forecast error suggests high-paying companies or their jobs are leaving the city.

It’s precisely why KTTH host Jason Rantz called the news “catastrophic” in a .

“What people haven’t realized yet—but soon will—is that the sharp drop in payroll expense tax revenue means jobs are leaving Seattle,” Rantz explained. “The whole point of the PET was to squeeze ‘free’ money out of businesses because the city arrogantly assumed it held all the cards. But what did PET actually do? It pushed Amazon jobs to Bellevue, kept employees working from home (and out of Seattle), and helped fuel layoffs at companies hit hardest by the tax—like Expedia.”

Jobs ²¹°ù±ðÌýleaving Seattle

Even Harrell acknowledged, “This decrease in revenue is aligned with recent reports of major employers moving thousands of high-paying jobs out of Seattle to other cities in our region.”

“Large corporations should pay their fair share and we should be wary when they use job placements to avoid paying funding that our communities rely on, but we also must recognize businesses will make choices based on their bottom line,” Harrell wrote in his statement. “We need to design our tax policies with the full context of our economy and a comprehensive view that ensures we raise the revenue needed to support all of our residents in a progressive way, aligned with our values.”

Rantz called Harrell’s response “strategically naïve.”

“Businesses pay far more than their fair share and offer Seattleites high salaries that the city uses on wasteful, ineffective programs,” Rantz explained. “Harrell knows big business already pays ‘their fair share’ but offers his silly quote to try to villainize them, while lionizing his own efforts to go after the businesses he pretends are greedy. But he’s the greedy one: he wants more money that he didn’t earn so he can continue to misspend it. And he’ll target businesses as greedy or deceitful so it can help his re-election campaign.”

He noted that the Seattle payroll tax idea may go statewide with the budget proposal from Washington Democrats.

What’s next?

Republican State Rep. Chris Corry of Yakima took notice of the payroll woes in Seattle. He posted, “Paging literally everyone in Olympia.”

Not everyone sees this as “catastrophic,” though.

³ÉÈËXÕ¾ Newsradio Political Analyst Matt Markovich says the revenue drop is “concerning,” but notes that the $47 million can be made up in the next budget cycle.

This was originally published on March 2, it has been updated and republished since then.