Economic Impact of Increasing San Francisco’s Overpaid Executive Tax

Economic Impact of Increasing San Francisco’s Overpaid Executive Tax

Anna Rue
Anna Rue

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PPG was commissioned to independently assess the economic impact on SF businesses, from the proposed ballot measure to increase the Overpaid Executive Tax.

The report received media coverage from ABC7 Eyewitness News.

We estimated the likely flow-on effects for local SF businesses, workers, consumers, and taxpayers, based on real-life experiences of other communities.

Key Findings:

  • Jobs at risk: Over 10,000 SF jobs may be at risk between 2026 and 2027, with 50% of losses concentrated in grocery and food retail.
  • Wage losses: Total wage losses are estimated at $574 million in 2027.
    • On average, SF workers could lose over $1,000 per year.
    • Workers in grocery and food retail could lose over 7x more in wages – around $7,550 per worker.
  • Reduced business profitability: In low-margin sectors like grocery and food retail, the increased tax could absorb some 20–25% of typical profit margins.
    • Up to 1,500 SF businesses – across all industries – face sustained pressure on profitability, raising the risk that businesses will downsize or exit the city.
  • Consumer prices: Higher business costs will be passed on to consumers, at least in part.
    • In 2027, consumer prices will likely increase by an additional 1%–0.2%; roughly 8–10 times higher than the 2026 impact.
  • Low-income households are hit hardest as they spend a larger share of their income on everyday essentials.
    • In 2027, lower-income households could face around 3–4 times the relative cost burden of higher-income households.
    • Income losses for these households could reduce total spending across the SF economy by over $2 for every $1 of income they lose.
  • Tax revenue at risk: Even a 5% reduction in qualifying business receipts due to downsizing, relocation or restructuring of SF businesses could eliminate up to $15 million from officially projected OET revenues in 2027 alone.

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