San Francisco voters pass 'Overpaid Executive Tax' for execs making 100 times more than workers

San Francisco residents have voted in favor of a so-called "Overpaid Executive Tax," to what supporters say is an effort to help close the city's income gap.

The new tax was passed Tuesday through a ballot initiative and will be applied on any company conducting business in San Francisco that has a top executive earning more than 100 times what any of their "typical local workers" are earning. 

Proposition L was drafted by a member of the city's Board of Supervisors and could reportedly generate as much as $140 million annual, which would go toward public health efforts. The tax applies to privately and publicly held companies. Some of the high paid executives in the surrounding high tech hub make their homes in San Francisco.

Companies with top executives that fall into this category will have to pay a 0.1% surcharge on annual business taxes. The tax increased by 0.1% per multiple of 100, meaning that an executive making 300 times the average company employee would be taxed a surcharge of 0.3%. The element tops out at 0.6%.

Richie Greenberg, a former San Francisco mayoral candidate was critical of the new measure.

"Such a tax would most likely prevent the attraction of new businesses to relocate to San Francisco, at such a time as we are seeing unprecedented economic downturn due to the pandemic,” he said.