In response to projected budget deficits resulting from the COVID-19 pandemic, as well as pending tax litigation, San Francisco is considering the adoption of several tax measures designed to raise revenue in the near term and to ensure increased revenue in the medium and long term. The effect on San Francisco taxpayers would vary based on their activities, executive compensation, and level of gross receipts apportioned to San Francisco.
Some taxpayers could see their existing City tax liability more than double, and the long term impact of these tax changes could alter the business tax landscape of San Francisco for the next several years.
Revenue raising initiatives will be underway over the next month as the Mayor and the BOS attempt to reach a compromise about new gross receipt tax rates. As new rate proposals are put forward, tax departments likely will be asked to model the impact on the various operations of their businesses.
Should the City pass a significant portion of the proposed tax proposals, affected taxpayers could see their existing taxes increase substantially. Such tax increases could significantly alter the manner in which organizations choose to conduct business in San Francisco.