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{{tnr}}A '''San Francisco Gross Receipts Tax on Businesses, Proposition E''' ballot question was on the {{nov06ca2012}} for voters in {{san francisco}}.<ref name=gross>[http://www.sfgate.com/bayarea/article/S-F-supes-OK-tax-reform-measure-3752100.php ''San Francisco Chronicle'', "S.F. supes OK tax-reform measure", August 1, 2012]</ref>
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{{tnr}}A '''San Francisco Gross Receipts Tax on Businesses, Proposition E''' ballot question was on the {{nov06ca2012}} for voters in {{san francisco}}, where it was '''approved'''.<ref name=gross>[http://www.sfgate.com/bayarea/article/S-F-supes-OK-tax-reform-measure-3752100.php ''San Francisco Chronicle'', "S.F. supes OK tax-reform measure," August 1, 2012]</ref>
  
The ballot measure, if approved by the city's voters, will phase out the city's current payroll tax over a period of five years and replace it with a gross receipts tax. It is estimated that this will result in $28.5 million more a year in revenue to the city.<ref name=gross/>
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Measure E will phase out the city's current payroll tax over a period of five years and replace it with a gross receipts tax. It is estimated that this will result in $28.5 million more a year in revenue to the city.<ref name=gross/>
  
 
San Francisco previously levied a Gross Receipts Tax (GRT) on businesses. It gave up that tax in 2001 as part of a lawsuit settlement, when a California court ruled that the two-tiered GRT then in effect was unconstitutional.
 
San Francisco previously levied a Gross Receipts Tax (GRT) on businesses. It gave up that tax in 2001 as part of a lawsuit settlement, when a California court ruled that the two-tiered GRT then in effect was unconstitutional.
  
About 10% of the businesses in San Francisco pay the current payroll tax that San Francisco levied after it gave up its previous GRT. That's because the current payroll tax only applies to businesses with more than $250,000 in payroll; they must pay a tax to the city of 1.5% on their entire payroll expense. If this ballot measure passes, every business in the city will pay a tax, which means that 90% of the businesses in San Francisco will pay more in taxes than they currently do.<ref name=bc>[http://www.beyondchron.org/news/index.php?itemid=10147 ''Beyond Chron'', "Progressives Should Support SF Business Tax Overhaul", May 14, 2012]</ref><ref name=history/>
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About 10% of the businesses in San Francisco pay the current payroll tax that San Francisco levied after it gave up its previous GRT. That's because the current payroll tax only applies to businesses with more than $250,000 in payroll; they must pay a tax to the city of 1.5% on their entire payroll expense. If this ballot measure passes, every business in the city will pay a tax, which means that 90% of the businesses in San Francisco will pay more in taxes than they currently do.<ref name=bc>[http://www.beyondchron.org/news/index.php?itemid=10147 ''Beyond Chron'', "Progressives Should Support SF Business Tax Overhaul," May 14, 2012]</ref><ref name=history/>
  
 
The San Francisco Board of Supervisors put new business taxes on the local ballot in 2002 and 2004 to try to make up for the tax they lost when a court ruled that their GRT was unconstitutional. The city's voters, however, rejected those business taxes.<ref name=bc/>
 
The San Francisco Board of Supervisors put new business taxes on the local ballot in 2002 and 2004 to try to make up for the tax they lost when a court ruled that their GRT was unconstitutional. The city's voters, however, rejected those business taxes.<ref name=bc/>
 +
 +
==Election results==
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 +
{{Short outcome
 +
| title = Measure E
 +
| yes = 223,887
 +
| yespct = 70.75
 +
| no = 92,577
 +
| nopct = 29.25
 +
| image =
 +
| unresolved =
 +
| state = Local
 +
| percent = 50.00
 +
}}
 +
:''Final certified results from the [http://sfelections.org/results/20121106/index.php San Francisco County elections office].''
  
 
==Support==
 
==Support==
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* Supervisor John Avalos: "This is a change in the business tax structure that's been a long time coming. It's a measure that's fair and will stand up to the test of time."<ref name=gross/>
 
* Supervisor John Avalos: "This is a change in the business tax structure that's been a long time coming. It's a measure that's fair and will stand up to the test of time."<ref name=gross/>
  
* The San Francisco Chamber of Commerce. Steve Falk, president and CEO of the group, says, "When you see the Chamber of Commerce and the Labor Council on the same podium, you know something is going on and that something must be positive."<ref name=gross/>
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* The San Francisco Chamber of Commerce. Steve Falk, president and CEO of the group, said, "When you see the Chamber of Commerce and the Labor Council on the same podium, you know something is going on and that something must be positive."<ref name=gross/>
  
 
* The San Francisco Labor Council.<ref name=gross/>
 
* The San Francisco Labor Council.<ref name=gross/>
  
* Progressive journalist Randy Shaw, who says, "Shifting from taxing jobs to gross receipts is itself a progressive victory, and creates a platform from which future revenue increasing measures can be spawned."<ref name=bc/>
+
* Progressive journalist Randy Shaw, who said, "Shifting from taxing jobs to gross receipts is itself a progressive victory, and creates a platform from which future revenue increasing measures can be spawned."<ref name=bc/>
  
* The "technology business sectory" in the city is in favor of transitioning to a GRT. As a whole, they say that the current payroll tax punishes job creation. Ron Conway, a leader with sf.citi, a public policy group that some describe as "a tech rival to the [San Francisco Chamber of Commerce], says, "We are in favor a of a gross-receipts-based tax solution."<ref name=history/>
+
* The "technology business sectory" in the city is in favor of transitioning to a GRT. As a whole, they said that the current payroll tax punishes job creation. Ron Conway, a leader with sf.citi, a public policy group that some describe as "a tech rival to the [San Francisco Chamber of Commerce], sayid, "We are in favor a of a gross-receipts-based tax solution."<ref name=history/>
  
* Proposition E has been endorsed by the editorial board of the ''[[San Francisco Chronicle]]'', writing, "Prop. E...would shift the city's chief business tax from payroll size to receipts [and is] a fairer measure that won't penalize job growth."<ref>[http://www.sfgate.com/opinion/editorials/article/S-F-ballot-choices-November-2012-3965570.php ''San Francisco Chronicle'', "S.F. ballot choices, November 2012", October 19, 2012]</ref>
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* Proposition E was endorsed by the editorial board of the ''[[San Francisco Chronicle]]'', writing, "Prop. E...would shift the city's chief business tax from payroll size to receipts [and is] a fairer measure that won't penalize job growth."<ref>[http://www.sfgate.com/opinion/editorials/article/S-F-ballot-choices-November-2012-3965570.php ''San Francisco Chronicle'', "S.F. ballot choices, November 2012," October 19, 2012]</ref>
  
 
==Text of measure==
 
==Text of measure==
Line 36: Line 51:
 
The measure was referred to the ballot by an 11-0 vote of the San Francisco Board of Supervisors on July 31, 2012.<ref name=gross/>
 
The measure was referred to the ballot by an 11-0 vote of the San Francisco Board of Supervisors on July 31, 2012.<ref name=gross/>
  
The unanimous approval of the ballot measure by the San Francisco Board of Supervisors came after months of wrangling about whether the measure should be a "revenue neutral" transition from the payroll tax to a GRT, or whether the new GRT should bring in more revenue every year than the payroll tax it will replace. The local [[SEIU]] threatened to place a rival tax increase on the ballot via the petition process unless the GRT added additional revenues. Ultimately, local politicians agreed not only to moving to a GRT over a payroll tax, but to what amounts to an overall tax increase on businesses in the city.<ref name=history>[http://www.sfgate.com/bayarea/article/Key-calls-for-SF-mayor-worker-pay-business-taxes-3520083.php#page-2 ''San Francisco Chronicle'', "Key calls for SF mayor: worker pay, business taxes", April 29, 2012]</ref>
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The unanimous approval of the ballot measure by the San Francisco Board of Supervisors came after months of wrangling about whether the measure should be a "revenue neutral" transition from the payroll tax to a GRT, or whether the new GRT should bring in more revenue every year than the payroll tax it will replace. The local [[SEIU]] threatened to place a rival tax increase on the ballot via the petition process unless the GRT added additional revenues. Ultimately, local politicians agreed not only to moving to a GRT over a payroll tax, but to what amounts to an overall tax increase on businesses in the city.<ref name=history>[http://www.sfgate.com/bayarea/article/Key-calls-for-SF-mayor-worker-pay-business-taxes-3520083.php#page-2 ''San Francisco Chronicle'', "Key calls for SF mayor: worker pay, business taxes," April 29, 2012]</ref>
  
Mayor Ed Lee and Supervisor John Avalos also wrangled back-and-forth with competing visions of how best to increase the business tax in the city before agreeing on the November measure as a compromise.<ref>[http://www.sfexaminer.com/local/2012/06/dueling-real-estate-taxes-submitted-november-ballot-lee-and-avalos ''San Francisco Examiner'', "Dueling real estate taxes submitted for November ballot by Lee and Avalos", June 20, 2012]</ref>
+
Mayor Ed Lee and Supervisor John Avalos also wrangled back-and-forth with competing visions of how best to increase the business tax in the city before agreeing on the November measure as a compromise.<ref>[http://www.sfexaminer.com/local/2012/06/dueling-real-estate-taxes-submitted-november-ballot-lee-and-avalos ''San Francisco Examiner'', "Dueling real estate taxes submitted for November ballot by Lee and Avalos," June 20, 2012]</ref>
  
 
==See also==
 
==See also==

Latest revision as of 08:08, 21 March 2014

A San Francisco Gross Receipts Tax on Businesses, Proposition E ballot question was on the November 6, 2012 ballot for voters in San Francisco, where it was approved.[1]

Measure E will phase out the city's current payroll tax over a period of five years and replace it with a gross receipts tax. It is estimated that this will result in $28.5 million more a year in revenue to the city.[1]

San Francisco previously levied a Gross Receipts Tax (GRT) on businesses. It gave up that tax in 2001 as part of a lawsuit settlement, when a California court ruled that the two-tiered GRT then in effect was unconstitutional.

About 10% of the businesses in San Francisco pay the current payroll tax that San Francisco levied after it gave up its previous GRT. That's because the current payroll tax only applies to businesses with more than $250,000 in payroll; they must pay a tax to the city of 1.5% on their entire payroll expense. If this ballot measure passes, every business in the city will pay a tax, which means that 90% of the businesses in San Francisco will pay more in taxes than they currently do.[2][3]

The San Francisco Board of Supervisors put new business taxes on the local ballot in 2002 and 2004 to try to make up for the tax they lost when a court ruled that their GRT was unconstitutional. The city's voters, however, rejected those business taxes.[2]

Election results

Measure E
ResultVotesPercentage
Approveda Yes 223,887 70.75%
No92,57729.25%
Final certified results from the San Francisco County elections office.

Support

  • Mayor Ed Lee: "There's a need for the city to build consensus on a complicated measure like this."[1]
  • Supervisor John Avalos: "This is a change in the business tax structure that's been a long time coming. It's a measure that's fair and will stand up to the test of time."[1]
  • The San Francisco Chamber of Commerce. Steve Falk, president and CEO of the group, said, "When you see the Chamber of Commerce and the Labor Council on the same podium, you know something is going on and that something must be positive."[1]
  • The San Francisco Labor Council.[1]
  • Progressive journalist Randy Shaw, who said, "Shifting from taxing jobs to gross receipts is itself a progressive victory, and creates a platform from which future revenue increasing measures can be spawned."[2]
  • The "technology business sectory" in the city is in favor of transitioning to a GRT. As a whole, they said that the current payroll tax punishes job creation. Ron Conway, a leader with sf.citi, a public policy group that some describe as "a tech rival to the [San Francisco Chamber of Commerce], sayid, "We are in favor a of a gross-receipts-based tax solution."[3]
  • Proposition E was endorsed by the editorial board of the San Francisco Chronicle, writing, "Prop. E...would shift the city's chief business tax from payroll size to receipts [and is] a fairer measure that won't penalize job growth."[4]

Text of measure

The question on the ballot:

Proposition E: "Ordinance amending the Business and Tax Regulations Code to: 1) enact a new Article 12-A-1 (Gross Receipts Tax Ordinance) to impose a gross receipts tax and an administrative office tax on persons engaging in business activities in San Francisco; 2) amend Article 12-A (Payroll Expense Tax Ordinance) to reduce business payroll expense tax rates based on the amount of gross receipts tax collected under Article 12-A-1 (Gross Receipts Tax Ordinance); 3) amend Article 12 (Business Registration Ordinance) to establish business registration fees based on gross receipts and amend the current Business Registration fees to generate approximately $28.5 million in estimated additional revenue; 4) amend Article 12-A (Payroll Expense Tax Ordinance) to add a sunset date to the surplus business tax revenue credit; and 5) amend Article 6 (Common Administrative Provisions) to establish requirements for filing a tax return under Article 12-A-1 (Gross Receipts Tax Ordinance), establish penalties for non-filing, and amend the requirements for filing payroll expense tax returns and penalties for non-filing to conform to the new gross receipts tax."[5]

Path to the ballot

The measure was referred to the ballot by an 11-0 vote of the San Francisco Board of Supervisors on July 31, 2012.[1]

The unanimous approval of the ballot measure by the San Francisco Board of Supervisors came after months of wrangling about whether the measure should be a "revenue neutral" transition from the payroll tax to a GRT, or whether the new GRT should bring in more revenue every year than the payroll tax it will replace. The local SEIU threatened to place a rival tax increase on the ballot via the petition process unless the GRT added additional revenues. Ultimately, local politicians agreed not only to moving to a GRT over a payroll tax, but to what amounts to an overall tax increase on businesses in the city.[3]

Mayor Ed Lee and Supervisor John Avalos also wrangled back-and-forth with competing visions of how best to increase the business tax in the city before agreeing on the November measure as a compromise.[6]

See also

External links

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References


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