San Francisco's Proposed CEO Tax Goes Down

San Francisco has pulled the plug on a plan to sharply raise taxes on companies with sky-high executive pay. Updated election returns Monday showed about 53.6% of voters rejecting Proposition D, with just over 46% in favor, signaling the measure is likely headed for defeat, reports the New York Times. Dubbed the "Overpaid CEO Tax" by backers, the proposal would have expanded an existing levy on large firms whose top executives earn more than 100 times their workers' median pay, and would have measured that gap using pay for all company employees, not just those in San Francisco.

A city analysis projected that the change could have delivered $250 million to $300 million a year for city services, coupled with a loss of roughly 940 jobs. San Francisco still faces a budget deficit, Yes on D rep Scott Mann tells the San Francisco Chronicle. "The cuts that follow will fall hardest on the people who can least afford it—the patients who depend on our public hospitals, the families who rely on city services, and the workers who make this city run," he says.

The measure drew heavy opposition from Mayor Daniel Lurie and tech leaders including Google co-founder Sergey Brin and DoorDash CEO Tony Xu, who spent heavily to defeat it (Prop D opponents spent some $6.6 million, about twice what its proponents spent, notes the Chronicle), warning of further business flight and slower recovery. The result adds to evidence that famously liberal San Francisco has been tacking toward the center in recent years.