VOTER GUIDE
PROP K: REMOVED
Retail Fairness and Guaranteed Income Tax Act
So, what happened to Prop K? It’s actually been removed from your ballot. Intended as a tax on Amazon to fund universal basic income programs for select people, Prop K’s poor wording meant it would have taxed small businesses, not Amazon. Its own authors petitioned to remove it from the ballot. The failure of Prop K is the perfect example of why special interests should not be putting complex tax measures before voters.
The Context
This Proposition was supposed to increase taxes on retail or wholesale sales involving transportation, delivery or shipment of goods to an address in San Francisco—essentially targeting online retailers who ship to San Francisco, like Amazon. But the authors of the proposition failed to realize that because more than 80 percent of Amazon’s local revenue comes from providing Amazon Web Services to tech companies, Amazon is actually considered an “information” company under local tax laws, not an online retailer.
The tax would instead have targeted San Francisco-based companies that are considered online retailers, like Everlane and Allbirds, and Amazon would’ve evaded the tax entirely. According to the President of the Small Business Commission, Sharky Laguana, there are over 600 retail and wholesale companies in San Francisco that would have been affected by the tax increase.
The measure also provided absolutely no information as to how the Universal Basic Income program created by this measure would have been administered.
Support & Opposition
This measure was funded and backed by a local developer named John Elberling, who funds ballot measures by refinancing his portfolio of affordable buildings. His corporation owns affordable housing buildings from the 1970s and financially leverages them to fund ballot measures and political campaigns year after year. Another prop on the ballot this November is being funded by TODCO/Elberling: the vacant homes tax. Elberling has been criticized for not using the refinancing money to actually benefit his tenants, instead using them for personal political gain.
Paid for by TogetherSF Action. Not authorized by any candidate or a committee controlled by a candidate. Financial disclosures are available at sfethics.org.
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