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San Francisco voters have overwhelmingly approved a ballot measure to impose additional taxes on any company that pays an employee who earns 100 times more than its average worker.
The ballot question was approved on Tuesday by 65 per cent voters with 230,298 yes votes and 123,943 votes. “A new tax is to be imposed on San Francisco businesses when their highest-paid managing employee earns more than 100 times the average compensation paid to their employees in San Francisco,” the ballot question said.
The tax is expected to increase from 60 60 million to 140 140 million per year. Large businesses – with a total receipt of more than 1 1 billion in gross receipts, 1,000 employees nationwide and administrative offices in San Francisco – will pay an additional tax of 0.4 percent to 2.4 percent of their San Francisco payroll costs. Other businesses that pay tax on gross receipts instead of payroll costs “will increase the additional tax from 0.1 percent to 0.6 percent. [their] San Francisco Total Achievements. “
The tax affects not only large, local companies such as Salesforce, but also large corporations doing business in the city, such as Visa and JPMorgan, NBC News reported. A similar tax in Portland, Reg Reagan only affects companies held in public, but the San Francisco tax affects both private and public companies, according to an NBC News article.
The percentage charged will vary depending on the size of the “executive pay ratio” between the top and average salaries. City government leaders urged voters in writing to approve the tax:
The greater the inequality between the top executives and their workers, the greater the surcharge. Corporations can avoid taxes simply by paying their officers less or raising the salaries of their employees.
We believe that large corporations that can afford to pay their officers millions of dollars in salaries each year can pay their fair share of taxes to help us recover. Over the past 30 years, executive salaries in the United States have increased by 940 percent. But the wages of regular workers have increased by only 11 per cent. Prop L encourages companies to invest not only in their executives but also in their workers.
City leaders also said the new tax would “rent the city hundreds of nurses, doctors and first responders.” But income can change a lot year after year. “The narrow base of expected payers, the annual fluctuations in the value and form of executive compensation and the potential transfer risk associated with tax increases contribute to the high volatility of the proposed tax, and estimates based on activity over previous years cannot predict future revenue,” said City Controller Benn. And explained revenue estimates of વર્ષે 60 million to 140 140 million a year.
For tax purposes, compensation includes assets including wages, salaries, commissions, bonuses and stock options, as well as “compensation for services to owners of pass-bag units and any other type of remuneration paid to employees for services.”
A study by the Institute for Economic Policy found that in 2019, CEOs of the top 350 U.S. businesses “earn”[ed] 2060 times the typical worker, “which increases from 3 up3-to-from in 2012 and from 1665 to 21 in 21 and 1 in 1989.” That statistic is based on a CEO pay scale that “stock rewards are calculated when given and allowed when stock options are given.” The average CEO salary of these 350 companies was $ 21.3 million.
Conservative outburst “strange hocus x-pox tax”
The tax was opposed by tax-conscious people.
“Employees’ salaries are based on experience and the value of the company. Proposal L imposes such a bizarre hocus cas-pox tax on executive salaries, an incentive to hire new entry-level employees (or to reorganize existing employees),” wrote Republican politician Richie Greenberg. “In other words, companies will reduce or stop hiring lower-level employees in response to the move, if it is to pass,” the opposition said in an official statement. In addition, such taxes largely prevent the attraction of new businesses to relocate to San Francisco, at a time when we are witnessing an unprecedented economic downturn due to the epidemic. “
Greenberg also accused City Hall leaders of having an “unwanted obsession with social media and information technology” and ignored that “San Francisco is more than just social media tech.”
“[T]The sentiment of many City Hall leaders is that technology has created an economic imbalance – yet these same leaders ignore the fact that state-of-the-art medical research facilities and financial services sectors have a big impact and employee base “the city,” he wrote.
The city’s Democratic Party responded, “Don’t trust the Republican Party’s intimidating tactics. San Francisco is one of the most desirable cities in the United States for companies to be located. They will have a slightly smaller share in their corporate taxes. Can afford to pay millions of dollars a year. “
The tax was also opposed by the San Francisco Taxpayers Association and the San Francisco Libertarian Party.
The success of the ballot question shows that “voters are demanding that we take action on inequality” “Matt Haney, who serves on the city board of supervisors and sponsors the ballot question, Wrote on Twitter. He wrote that the new revenue would “support our health and public health systems, which are strained by the consequences of inequality. We will employ nurses, social workers and emergency responders, and expand access and treatment.”
