In 2009, the voters of the city of San Francisco approved proposition Q. The net effect of this initiative was to tax the payroll of partnerships, including lawyers, hedge fund managers and doctors. The California Supreme Court recently denied review of a lower court’s decision that this is a legitimate tax voted on by the people of San Francisco.
The protagonists were essentially fighting about a decade’s worth of payroll taxes, a not inconsequential amount of money. The city is in the midst of a transition away from payroll taxes to gross receipts taxes. The counter argument that this is a tax on the privilege of doing business in San Francisco doesn’t seem to carry much weight or be very important. Another argument will be made … No one likes to pay taxes, until they need the public services.