council ceo skewers ipo tax proposal
A proposal this week to tax IPO stock-based compensation brought swift condemnation from Bay Area Council CEO Jim Wunderman. In a San Francisco Chronicle story, Wunderman called the tax a “terrible idea” that would only discourage innovation, jobs and investment. The proposal by San Francisco Supervisor Gordon Mar comes as several companies, including Lyft and Pinterest, recently began selling stock publicly and a number of others, including Uber, Slack and Airbnb, are eyeing their own IPOs. The punitive tax grab ignores the significant contributions that start-ups and early stage companies make to the local and regional economy—past Bay Area Council Economic Institute research shows that each new tech job supports between four and five other good-paying service jobs. It also continues the long-running canard blaming tech companies for a regional housing crisis whose real causes are rooted in entrenched local resistance to building more homes, outdated zoning rules and onerous regulations and fees. And it ignores a $325 million budget windfall the city is projected to receive from excess state education funds, much of which will likely be targeted to affordable housing programs. Not to mention the sizeable taxes San Francisco already receives from employees living and working in the city. The Council will be monitoring the IPO tax proposal and taking appropriate action.