SAN FRANCISCO (KCBS) — A new controller’s report says eliminating San Francisco’s payroll tax on stock options would cost the city up to $75,000 a year in future revenue.
San Francisco is the only city in the nation that taxes stock options, resulting in higher taxes for a company that goes public. But although eliminating those taxes would hurt the city’s coffers, Supervisor Mark Farrell said the alternative is worse.
KCBS’ Barbara Taylor Reports:
”If we don’t correct this, we as a city don’t believe that these companies will stick around, or new companies will start here in San Francisco,” said Farrell.
Farrell’s legislation would cap the amount of tax companies pay on stock options at their current level, while another supervisor has introduced a two-year tax exclusion. Farrell says at the end of the day it’s about retaining and creating jobs in San Francisco.
”We need to do all that we can in terms of our tax policies to make sure that happens, and in my view creating a long-term solution for that is absolutely the right approach,” said Farrell.
The city collects about $350 million each year in payroll taxes, with the tax on stock options only a tiny fraction of the total.
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