San Francisco Proposes 'IPO Tax' On Eve of Uber Offering

'San Francisco voters this November will be asked to approve a corporate tax increase on stock-based compensation from 0.38% to 1.5%,' reports Axios. Since the rate hike would be retroactive to May 7, it would apply to Uber's recent $8 billion IPO. From a report: San Francisco Board of Supervisor Gordon Mar said six supervisors are supporting the ordinance -- the minimum number needed to get the measure on the Nov. 5 ballot. The full board is expected to vote on the plan within the next two months. At least two-thirds of voters would need to support the proposal for it to pass. Mar's proposal calls for raising the stock-based compensation tax from 0.38 percent to 1.5 percent. That increase would generate hundreds of millions of dollars for the city. The tax is levied on San Francisco companies when employees who receive stock as part of their compensation decide to cash in those shares on the public markets or on secondary markets.

But Mar's proposed ordinance concerns the Bay Area Council, which advocates for businesses. 'There's no version of this poorly conceived scheme that would get our support,' said Rufus Jeffris, a spokesman for the Bay Area Council. 'And if the BOS approves putting this misguided proposal on the ballot, we believe voters will communicate the same message.' The Bay Area Council is concerned that the higher tax would discourage investment, innovation and jobs in the region.

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