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What are you talking about? It specifically talks about it and even provides 2 quotes with contradicting points of view: “Alex Tourk, spokesman for sf.citi, a
by dickeytk 7y ago
What are you talking about? It specifically talks about it and even provides 2 quotes with contradicting points of view:
“Alex Tourk, spokesman for sf.citi, a tech business group, said San Francisco needs to consider changes to its business taxes. The city is currently reviewing the tax system, which brings in a total of $1 billion annually. But those taxes could climb higher under the revised system.
“Unfortunately, Stripe choosing to leave town is not an anomaly,” he said. “The membership of sf.citi would prefer a more holistic strategy per the mayor’s suggestion that we work together as a collective business community to fix the gross receipts tax once and for all and establish a fair and equitable tax system that we can all rely on.”
Chris Thornberg, founder of Beacon Economics, said businesses leaving San Francisco has more to do with real estate costs and high wages than taxes.
“Taxes don’t have a lot of impact on business decisions. It’s something that has been exaggerated for years,” Thornberg said. Stripe is staying in the Bay Area, so its departure isn’t a blow to the region, he said.”
- benchtobedside 7y agoNeither of these two quotes in the article provide a compelling counterpoint to the outsized impact that Prop C would have had on Stripe's business.
- deleted 7y ago[deleted]
- x0x0 7y agoYeah. Salesforce probably has north of 50% margins. Eating 1% is annoying but livable. A Square or Stripe type business probably has under 5% margins, making this a tax of 10 to 20 percent of profit.
- gamblor956 7y agoUnless things changed over the summer, Square is not profitable, so this is just an additional major expense that makes profitability harder to achieve.
- gyc 7y agoI doubt the wages are going to be appreciably different in South San Francisco. Office rents is probably one reason, but the gross receipts tax is almost certainly the biggest reason for the move.
- nrp 7y agoThere’s also the impact of Prop M, which caps new office square footage created yearly. Stripe may not be able to find contiguous space big enough for their expected growth even if they wanted to stay in San Francisco.
- deleted 7y ago[deleted]
- kortilla 7y ago> Taxes don’t have a lot of impact on business decisions. Said nobody involved with any big business. Amazon in New York, Apple’s avoidance of repatriating cash, etc. Taxes have a massive impact on business decisions all of the time. This kind of ignorant thinking is what destroyed the yacht manufacturing industry in the US. “Oh, what difference can a small tax make? Whoops, doesn’t matter because I’m a politician and I’m immune to consequences.”
- gamblor956 7y agoBusinesses say that taxes make a huge impact because they don't like paying taxes. But they do business where they need/want to do business, regardless of the tax situation. Complaining about taxes is just an attempt at leverage to get tax rebates/concessions/exemptions/etc or to structure the final holding company in a way that artificially shields profits so the executives can pay themselves larger salaries and bonuses. Source: I was a former tax/legal advisor for a number of multinational companies. Out of a few hundred tax structurings, I can count on one hand the number of times that tax rate differentials affected material operational decisions.
- kortilla 7y agoNope. Taxes are treated equally as every other cost. Any opportunity to eliminate is treated just as seriously as anything else.