San Francisco is known as a technology hub, but it also has a great deal of homelessness due to the high cost of living that comes from that high-tech status. Because of this, there has recently been a great deal of debate about potentially taxing high-net-worth individuals and businesses as a way to raise funds to help the homeless population. During the recent midterm elections, San Francisco included a ballot initiative to tax tech companies with this goal, and the proposal passed. It remains to be seen how significant the tax impact will be on major tech companies, but there is no doubt that San Francisco residents who are homeless or living in poverty appreciate the measure.
The ballot measure was known as Proposition C, and it saw overwhelming support, earning 60 percent of the vote during the election. Experts estimate that this initiative will raise between $250 million and $300 million in extra revenue that can be used to help the homeless. Considering there are an estimated 7,500 people sleeping on San Francisco’s streets each night, this money is definitely needed.
The Fight Leading Up to the Ballot
Unsurprisingly, the months leading up to the ballot initiative were filled with a great deal of debate. High-net-worth individuals and businesses were not happy with the idea of seeing an increase in their taxes, although some companies and rich individuals were in favor of the initiative. Those against the measure said that the tax would lead to businesses leaving the city. On the other side, those in favor of the measure feel that San Francisco’s homelessness problem is a humanitarian crisis. Furthermore, they pointed out that part of the crisis is due to the tech boom’s influence on rising costs of housing, so the least the tech companies could do would be to contribute to resolving the problem with taxes.
While some may expect that most tech CEOs were against Proposition C, that is not the case. Marc Benioff, the Salesforce CEO, for example, was one of the very vocal supporters of Proposition C, putting millions of dollars into campaigning for the measure. Those critical of the measure, such as CEO of Twitter and Square, Jack Dorsey, feel that there are other ways to resolve the issue of homelessness. Mark Pincus, the Zynga co-founder, also received criticism for his stance against Prop C.
A Conscious Effort to Help the Homeless
This tax initiative on the ballot is just one of the many ways that those in San Francisco, including those working in the tech industry, are working to resolve the homelessness issue. Tech workers were some of the most outspoken supporters of Prop C. Additionally, the large number of donations, particularly those from Benioff and Salesforce, helped the campaign immediately find some homeless people jobs. According to Jennifer Friedenbach, who is the Coalition on Homelessness’ executive director, the organization had budgeted to be able to hire 40 homeless people to work on the campaign for Prop C. Thanks to the massive donations, the organization was able to increase the wage of those workers and hire 200 people instead of just 40.
While the corporate tax for tech giants in San Francisco will increase, the community feels that it will have a positive impact on the area thanks to all that those funds will be able to do.
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