On November 6, 2012, San Francisco voters approved Proposition E, which replaces San Francisco's business tax based on payroll with one measured by gross receipts (the "Gross Receipts Tax"). The Gross Receipts Tax phases in over a five-year period beginning 2014 and there is a corresponding phase-out of the tax on payroll costs over the same period. Businesses with gross receipts of less than $1 million are exempt from the Gross Receipts Tax. The tax is generally progressive based on a taxpayer's gross receipts attributable to San Francisco (the "City"). The applicable tax rate range depends on the nature of the taxpayer's business and varies from 0.075% to 0.650%. Certain businesses that have their administrative offices in San Francisco will pay the gross receipts tax at a rate of 1.4% of payroll costs. The measure also increases annual business registration fees to as much as $35,000 for businesses with over $200 million in gross receipts.