Mountain View tailored its headcount business tax to Google, by far its largest and most profitable employer. Where in San Jose a company can find office space for about $4 a square foot, in Palo Alto it’s closer to $8 a square foot.īurt said that despite all its “incredible business wealth,” Silicon Valley has some of the lowest corporate taxes in the country, a reality many other cities have sought to change in recent years.
Leasing an office in Palo Alto is expensive - nearly twice as much as in San Jose, Burt said. He said it’s modeled largely after East Palo Alto’s tax on office square footage, focusing on larger offices while exempting small and community-serving businesses. This go-around Burt is confident the measure will appear on the ballot. “It appears there is good support on the council and in the community.”īurt said he pushed to have a per-employee tax measure go on the 2016 ballot but the council balked after fretting that it could hurt businesses and jeopardize countywide transportation Measure A. “It’s very likely we’ll get something in the November ballot,” Burt said. According to a city report, a 20-cent tax per square foot could bring in up to $43.4 million a year. Mayor Pat Burt said a majority of the city’s leadership has also indicated it supports the tax measure, which would help the city pay for future affordable housing projects, rail-grade separations required under Caltrain’s electrification plan and restoration of city services cut during the pandemic. A city report notes that despite the pandemic, Palo Altans feel a tax on businesses is overdue and a majority of voters would support it.
East palo alto smalland full#
On Monday, the council’s finance committee recommended that the full council move ahead with a ballot measure. Offices smaller than that would pay a flat $50 annual fee and those larger would pay either 5, 10 or 20 cents per square foot, depending on which option the council chooses. According to the proposal, the tax would apply to offices larger than 5,000 square feet. In the coming weeks, City Council members will be reviewing a staff proposal to place a square footage tax on the November ballot.
To this day, Palo Alto remains the only major Bay Area city without a business tax. PALO ALTO - As cities across the Bay Area seek to reap the benefits of Silicon Valley’s robust economy, Palo Alto could soon become the latest to levy a business tax aimed at tapping company pockets.įrom Tesla to Varian Medical Systems to SAP SE, Palo Alto’s billion-dollar companies - as well as its less lucrative ones - may have to start paying taxes on their office spaces to help finance city services and address their impacts on housing and transportation.įor years the city has flirted with a tax on businesses, but has backed off each time - once in 2008 right before the economic recession, then in 2016 and again in 2020 amid the coronavirus pandemic.
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