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People said we were making it up — that corporate flight was a myth. Now we’re a cautionary tale.
Washington’s largest companies knew higher taxes were coming.
They warned Gov. Bob Ferguson that they would damage the state’s business climate.
Instead of heeding their warnings, he privately tried to convince them the taxes were a good thing. He clearly failed.
That’s what I found from the public records.
When I heard Starbucks was leaving, I couldn’t shake the feeling that something was missing.
A landmark Seattle company doesn’t announce a $100 million investment in a massive new corporate hub in Nashville, begin laying off Seattle workers and hiring up to 2,000 in Tennessee without conversations happening behind the scenes.
Starbucks is one of Washington’s most politically connected companies and a cornerstone of Seattle’s economy. Surely someone had tried to stop it.
So, I filed public-records requests. What came back was a paper trail that Washington voters almost never saw.
The records show Starbucks had warned Ferguson in 2025 that portions of his tax package would hurt the state’s business climate.
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The company said taxing headquarters functions such as staffing, IT, security and advertising would “dramatically increase costs” and place it “at a competitive disadvantage to companies based in other states.”
It also warned that a new business-and-occupation tax surcharge would make it harder to invest in Washington.
That year, Ferguson signed the largest tax increase in state history anyway.
Starbucks CEO Brian Niccol requested a meeting with Ferguson in February. The meeting never happened.
Instead, the state passed its first income tax.
Months later, after Starbucks made its Nashville announcement, the governor finally reached out for a meeting. His staff prepared him for the conversation.
“The Nashville acquisition and continued Washington layoffs and closures continue to raise public questions about whether the company is gradually shifting its center of gravity,” the memo warned.
Staffers also anticipated Niccol would bring up the 2025 tax increases and this year’s new income tax.
The governor’s response wasn’t to reconsider the policies. It was to try and sell them.
His briefing book contained talking points explaining why Washington remained a great place to do business despite higher taxes.
“Similar to your work bringing Starbucks ‘back to basics,’ my focus is getting Washington back to delivering excellent core public services,” one prepared talking point read.
The strategy was straightforward: Argue that higher taxes would pay for better schools, roads, bridges and public services that would ultimately benefit employers.
By the time of the April 15 meeting at Starbucks headquarters, Ferguson’s own staff had documented the scale of the company’s flight from Washington.
Two rounds of corporate and retail layoffs had affected nearly 1,300 Washington workers. Almost 40 stores had permanently closed.
Employment at Starbucks’ Seattle headquarters had fallen from roughly 3,750 workers in 2023 to about 2,800.
The records also showed Niccol identified public safety around Starbucks’ Seattle headquarters as a major concern.
That prompted another public-records request. Was Starbucks an isolated case?
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It wasn’t.
T-Mobile had also written lawmakers warning that Washington’s expanded sales tax on advertising services punished companies for keeping headquarters jobs in the state.
“Companies headquartered in Washington, with marketing teams or decision makers located here, incur this tax,” CEO Srini Gopalan wrote. “Companies headquartered outside Washington do not.”
The company warned that the tax created “an unintended competitive disadvantage for companies that choose to headquarter and employ workers in our state.”
Lawmakers left the tax in place.
T-Mobile has laid off nearly 400 Washington employees while continuing to expand campuses in Kansas, Texas and Georgia.
Before meeting with NBA Commissioner Adam Silver, Ferguson received another briefing memo discussing obstacles to bringing the Seattle SuperSonics home.
Among the anticipated topics were the income tax affecting the recruitment of top players and questions about whether Seattle remained an attractive place for investors after prominent businesses and leaders relocated to Florida.
Major employers weren’t blindsiding the governor and lawmakers with announcements after decisions had already been made.
They were warning state leaders, in writing, that Democrats’ tax policy was making Washington less competitive.
The governor knew. His staff knew. Lawmakers knew.
The conversations were happening. The warnings were delivered. The concerns were documented.
The public simply wasn’t part of them.
Seattle-area startups raised just $2.7 billion across 163 venture-capital deals during the first half of 2026, down about 40% from $4.5 billion across 210 deals a year earlier.
Among the nation’s 10 largest venture-capital markets, Seattle fell from fifth to seventh in dollars invested and ranked last in deal count during that time.
Microsoft, Amazon, Meta, Oracle and other Seattle-area tech companies have eliminated tens of thousands of Washington jobs since January.
Seattle office vacancy sits at roughly 37%, and statewide unemployment is 5.2%, a full percentage point above the national average.
Washington’s largest employers repeatedly warned state leaders that higher taxes would make the state less competitive.
Those warnings weren’t ignored because officials never heard them. They were ignored because they didn’t care.
And now Washington is paying the price.
Ari Hoffman hosts “The Ari Hoffman Show” on Seattle’s Talk Radio 570 KVI and is the Post Millennial’s West Coast editor.
