A significant organization in San Francisco is allocating $10 million this year to combat a proposed tax, arguing it could jeopardize the city’s delicate economic recovery and increase costs for struggling residents.
The moderate group, Neighbors for a Better San Francisco, aims to counteract a series of progressive initiatives and candidates that, according to its director Jay Chen, threaten to undo years of progress in the traditionally liberal city.
One of their primary concerns is the so-called “CEO tax.” This measure, set to appear on the ballot in June and backed by progressive factions and labor unions, would impose taxes on businesses with a significant disparity between the earnings of their top executives and their employees, shifting the focus away from taxing individual business owners.
“There’s no doubt this could devastate our economy overnight,” Chen expressed.
Retailers like Nordstrom, The Gap, Starbucks, Target, and Chipotle could see their tax liabilities surge, which would likely result in higher prices for consumers or, in some instances, cause them to close shop in the city, Chen noted.
“If the CEO tax passes in June, it sends a message to businesses that there’s no way to predict their tax obligations,” he added.
“Taxes would skyrocket—800% higher! How can any business plan for that?”
San Francisco currently employs an “overpaid CEO tax,” which levies an additional charge based on the ratio of executive pay to that of employees.
The new measure, backed by SEIU and other labor groups along with progressive officials like Supervisors Connie Chiang and Jackie Fielder, would significantly raise taxes for companies whose top earners make over 100 times the median worker’s income. Supporters believe it could generate $200 million annually to “maintain essential city services.”
Fielder, a democratic socialist, is also pushing for taxes on financial institutions to support a proposed public bank in San Francisco.
This initiative is part of a broader wave of populist tax proposals targeting high earners throughout the state, with a similar effort gaining traction in Los Angeles to tax companies with “overpaid CEOs.”
A local organization plans to oppose a suggested statewide billionaire tax that critics warn could siphon $1 trillion from California’s wealth.
“If we can establish a 50-50 split on the wealth tax in San Francisco, it may help repeal it statewide,” Chen mentioned.
Stephen Bassio, co-founder of the moderate group GrowSF, reaffirmed his apprehensions about the CEO tax while his organization evaluates the implications before issuing a formal response.
“Rather than taxing CEOs, we’re essentially taxing consumers. It’s pretty much a tariff on goods in San Francisco,” he pointed out.
Chen noted that Neighbors for a Better San Francisco is also backing San Jose Mayor Matt Mahan for governor, alongside moderate candidates for the Board of Supervisors and the Board of Education.
The influential organization played a pivotal role in the 2022 recall of the far-left district attorney Chesa Boudin and the removal of three progressive school board members.
Chen revealed that his primary financial backer is the Republican billionaire Bill Oberndorf, though he is also attracting growing support from smaller individual donors.
