The Overpaid Executive Tax pays for nurses, doctors & frontline emergency responders.
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The Pandemic isn’t over. Cities around the country are preparing for a spike in the curve by stocking up on medical equipment and hiring nurses, doctors, first responders, and other essential healthcare workers. San Francisco needs to be ready when the next wave hits.
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Our city economy has been seriously hurt by the economic shutdown. We’re facing a budget deficit of $1.7 billion dollars. The Overpaid Executive Tax is calculated to raise $140 million dollars every year, allowing the City to hire hundreds of nurses, doctors, first responders, and other essential healthcare workers.
Big companies will pay their fair share to help us recover.
San Francisco needs thousands more healthcare workers to meet our needs.
We believe that big companies that can afford to pay their executives million-dollar salaries every year can afford to pay their fair share in taxes to help us recover. Over the last 30 years, executive salaries in the United States have skyrocketed by 940%. But regular workers’ salaries have grown by just 11%.
COMMON SENSE TAX
The tax is simple. If the measure passes, any company that pays their top executive 100 times more than their average worker will have a 0.1% surcharge added to their annual business tax payment. The more inequity between the top executive and their workers, the higher the surcharge. If the top executive makes 200 times more than the average employee, then it’s a 0.2% surcharge; 300 times gets a 0.3% surcharge; and so on.
This measure not only raises much-needed funds to fix the cracks in our healthcare system, it also incentivizes companies to invest in their workers, not just their executives. Businesses can avoid the tax by paying their executives less or by simply raising their employees’ wages.
Do other cities have an Overpaid Executive Tax?
YES. Our tax is modeled on a similar surcharge that’s been implemented in Portland, Oregon. States including California, Connecticut, Illinois, Massachusetts, Maine, Rhode Island, and Washington are working on similar taxes to deal with rampant income inequality.
Will this tax hurt small businesses?
NO. The Overpaid Executive Tax only applies to companies that pay their executives over $2.8 million a year.
Will the city know how much a CEO makes and how much average workers are paid?
YES. Under the city’s auditing and compliance rules, companies are already required to self-report these numbers to the Treasurer and Tax Collector every year.
Will this make companies leave the city?
NO. San Francisco is one of the most desirable cities in the United States for companies to be located in. A small surcharge that can be avoided by simply reinvesting in your workers will have little to no impact on companies that can afford to pay their CEOs millions a year.
Is the pay gap between a CEO and a typical worker really that bad?
YES. It's bad. In 2018, a typical American CEO pocketed about $17.2 million a year. Their average employee, on the other hand, made about $56,000. That's nearly 300 times less pay than the CEO.
Do hospitals and healthcare workers really need more money?
YES. The Mayor’s new budget plan calls for 250 million dollars in cuts to the Department of Public Health over the next two years. And that’s after years of already being under-staffed and under-funded.