Business tax break debate inspires talk of tax structure changes

As the Board of Supervisors Budget and Finance Committee was debating Mayor Gavin Newsom’s proposed tax breaks for businesses, there was talk about overhauling the business tax structure overall.

“Our payroll tax is not wise,” Supervisor Ross Mirkarimi said. “And I think it needs to be upgraded in a graduated-tier system, whether it be gross receipts or a progressive payroll tax. I’m a big fan of this idea and hope that it’s something we rally around soon.”

Mirkarimi noted that there are 80,000 registered businesses in The City and 6,000 pay The City’s 1.5 percent tax on their payroll.

Similarly, Janet Clyde, vice-chair of the Small Business Commission, said, “There is a problem with the small business community with taxation that I believe needs to be addressed by looking at small business taxation overall. And that’s the lack of graduated rates and that’s the lack of indexing employee to gross income. Businesses are seen as a monolith in San Francisco”

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