Twitter CEO, Tech Giants Blast San Francisco Homeless Taxation Proposition
San Francisco voters approved a massive corporate tax that aims to infuse the city’s homeless services with $300 million annually. The crafters of the tax proposition are targeting some of San Francisco’s largest companies. Many of the city’s notable corporations are unhappy over the passing of the proposition, which passed by a nearly 60% approval.
This is the largest corporate tax in San Francisco’s history. Some media outlets, as well as President Trump, have criticized San Francisco as well as the entire state of California for a growing homelessness crisis. It is unlikely that a socialist-style taxation strategy will pacify critics. In the case of Proposition C, critics of the new addition to an already rigorous tax code are also coming from popular CEOs in the city.
Marc Benioff, founder and co-chief executive officer of Salesforce, is the man behind the creation and funding of Proposition C. He funded the proposition to the tune of $7.8 million. Following the passage of the proposition, Benioff tweeted, “Thank you, San Francisco.”
However, Jack Dorsey, the CEO of Twitter, lashed out at Benioff throughout the campaign for Proposition C. Dorsey is among several large tech giants that are opposed to the proposition, which they call “unfair.”
“I want to help fix the homeless problem in SF and California. I don’t believe this (Prop C) is the best way to do it,” Dorsey said on Twitter.
Zynga founder Mark Pincus called proposition C “the dumbest, least thought out prop ever. Please get the facts and vote no. Then lets all focus on real solutions for sf.”
San Francisco mayor, London Breed, also opposes the proposition.
But the voters have spoken and the rich are now on the hook for solving homelessness throughout the city.
Proposition C Unfairley Distributes Taxation
Dorsey, Pincus, and so many other enormous company executives are furious over the new proposition.
Because they believe the already stringent city tax code will deploy unfair taxation across the board. Targeting rich corporations with heavier taxes risks driving businesses out of town. Oddly, the “fairness” debate misses this looming point entirely.
Dorsey’s Square is 33% the size of Salesforce, but city code tax logic means Dorsey’s company pays more annually. Salesforce will pay an estimated $10 million annually as a result of Proposition C.
Proposition C taxes companies that earn more than $50 million per year. But the city already has a gross annual receipt revenue tax. The accounting logic will enable the city to tax some lower earning large corporations more than larger earning corporations.
Yes, rich people are mad that some lesser rich people will be taxed more than richer people. But they aren’t mad that rich people are being taxed more in general.
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In some ways, this is double-dipping for the purposes of socializing the homelessness crisis. Critics fear that large businesses which employee thousands around the area will leave for greener, less-taxing, pastures. Dorsey and other tech giants have a point, but in some ways, they are missing the forest for the trees.
San Francisco Homeless Crisis Continues To Swell
While reducing homelessness is important, lowering job numbers is unlikely the way to achieve it.
The middle class in California is notably sleeping in cars. San Francisco train stations often appear like a zombie apocalypse. Homeless people are being paid to clean human defecation from streets. The entire state has issues. Things are entirely bad.
Both Los Angeles and San Francisco are becoming unaffordable in terms of renting or buying homes. This is placing a major squeeze on an already thinning middle-class.
But the state’s voters are mostly content with the current path, continually voting in politicians who push an agenda many critics term as failing.
Will Big Tech Flee Silicon Valley?
The question now becomes, will large tech companies like Square and Stripe eventually flee the city? Places such as Plano, Texas offer lucrative tax benefits to companies that relocate to their region. While it may seem that tech companies would never leave Silicon Valley, it is important to remember that many of those same companies outsource production, customer service, and more to places in southeast Asia.
San Francisco city officials depend on big tech’s presence, now, more than ever. It would be impossible to prop up homeless financing without their presence. Locals would never be able to pay inflated rents if wages were reduced due to tech companies departing.
California readily supports socializing the state, but even the most loyal of voters may find they have their limits.
Feature photo by jdlasica
Author: Jim Satney
PrepForThat’s Editor and lead writer for political, survival, and weather categories.