“Cupertino elected officials have scrapped a controversial plan — for now — to impose an employee tax on Apple and other businesses in the city, saying they don’t want to move forward in haste and will instead ask voters to weigh in during a special election in 2019,” Khalida Sarwari reports for Bay Area News Group.
“Though the city council intended only to discuss the plan Tuesday night, after impassioned public comment during which several people spoke out against the proposal as either too vague or unfair to businesses, the council voted 3-1 to put off placing a measure on the November 2018 ballot. Vice Mayor Rod Sinks recused himself because his wife is an Apple employee,” Sarwari reports. “Councilman Barry Chang dissented, saying that waiting even another year would prolong the city’s transportation problems. ‘I think not only here, the big corporations in the entire nation, the corporations need to take up their fair share to help solve the problems we are facing now,’ Chang said. ‘So that’s why this issue needs to be done and needs to be done now instead of waiting.'”
“Chang said he proposed a more ambitious plan two years ago — which would have charged businesses $1,000 per employee — but that that proposal was shot down by other council members,” Sarwari reports. “‘Two years ago, no council member supported it, so nothing happened,’ he said. ‘Two years passed. If we don’t do anything this time now, another two years will pass, nothing will happen, I guarantee you.’
Read more in the full article here.
MacDailyNews Take: “If we don’t do anything this time now, another two years will pass, nothing will happen.” Good, because it’s a stupid idea.
Leave it to the Cupertino City Councilman Barry Chang to attempt milking the golden goose. Again. Although they have a long history of doing so, Cupertino really should stop electing the mentally challenged.
Unfortunately, Apple’s now a sitting duck… er, goose for such obscene money grabs. After all, it’s not like they’re going to abandon their brand new $5+ billion glass doughnut, The Colossal Distraction, with its so-perfect-there-was-no-time-left-for-core-products door handles.
Years ago, Steve Jobs educated a Cupertino City Councilperson on taxes:
Apple could get hit with employer tax in Cupertino – May 21, 2018
Cupertino Barry Chang mayor: Apple ‘abuses us’ by not paying taxes – May 5, 2016
Amazon suspends construction in Seattle while the city considers a new per-employee tax – May 2, 2018
Apple again expands downtown Seattle engineering center – April 17, 2018
Apple rumored to be taking big piece of Seattle-area office market in expansion – August 12, 2016
Apple buys machine-learning startup Turi for $200 million – August 6, 2016
Apple quietly buys Seattle firm to expand cloud offerings – November 4, 2014
As big, fat, and lazy as Apple is, I think they should give their fair share of money to the city and country that holds them up, lest they become too heavy and crush the world beneath their girth.
What is so ridiculous about all this is government makes these deals and provides abatements to companies in order to get them to build facilities in their city/region. If you can’t afford it you shouldn’t be giving them out. I don’t personally think corporations should get any tax benefit of any kind kind. If the city town whatever can’t win on their own merits then oh well.
“I don’t personally think corporations should get any tax benefit of any kind kind.”
I tend to agree particularly when the tax breaks expire and the companies can pack up or stay. These breaks are also highly political and palms are greased and not a level playing field. And the beat goes on …
so…. if you play the embedded video you’ll hear the truth….Apple pays a LOT in local taxes. Their employees live in the area, spend money in the area, Apple pays its fair share and follows the law. Part of the property development was Apple paying for the widening of the area roads and traffic easing.
Look at it this way – if you made more money than your neighbors and pay your property taxes, keep up your property and pay for infrastructure improvements around your property would you be willing to give a significant amount of what you make to them just because you make more?
do not punish success, just pay a fair share
A tax on jobs will mean that Apple’s spaceship will be the last commercial building built in Cupertino.
Too bad Apple’s Cupertino saucer can’t fly to other state. Hahahha
Does going back and forth to the State of Confusion count??
Oh wait….that’s STILL in California!!
MDNnis right on except there is something Apple can do. Leave. Amazon had same issue and they were not afraid to say, screw you huys we are leaving for greener pasture. The about face was so fast I Seattle, the entire council is suffering whiplash.
These idiots run things so inefficiently that the find of money brought in by so many high income tax individuals isn’t enough is damning in how poorly they run things.
I’m sure Apple can find a city that can run things more efficiently and would welcome them. They can sell the building at a loss and make it up in incentives given to move. A bidding war of epic proportions would open up for Apple if they were to move. F Cupertino’s commie council.
I hate to splash a little cold water on the anti-government feeding frenzy here, but it might be worth considering just why Cupertino, Mountain View, Seattle, etc. are considering these taxes.
The high-tech employers are paying spectacularly high salaries, far above the previous average local wages. That drives up prices for nearly everything, but particularly housing. The median price of a home in Cupertino is $2,358,449; the average monthly rent for an apartment is $3176. Housing prices are rising at roughly 12.5%/year.
People who are not making those high wages because they are working in other segments of the economy cannot afford those prices. Somebody has to repair the streets in Cupertino, sweep the floors, and staff the restaurants, and everybody will retire someday. All those people need to sleep somewhere, but they cannot find any place within their means.
So, homelessness, crime, and associated social problems in these high-tech centers have risen just as spectacularly as rents. Even casual observers have seen how many more people are sleeping on the streets of San Francisco. Government costs for rents, goods and services to address those problems—and to sustain existing services—are going up at the same rate as inflation for private parties. That inevitably results in much higher costs for government, which need to be financed in some fashion.
Like many states, California has “taxpayer relief” legislation that restricts the amount of revenue that can be raised from existing taxes. Cities do not collect income taxes (so the number of high income tax individuals in the community is irrelevant). Local sales taxes are capped at 2%. Property taxes are the main source of revenue. However, the taxes on individual parcels in California can only be raised by 2%/year, which is far lower than the inflation rate. Tax rates cannot be raised in most cases without approval by a supermajority in a referendum.
Sorry to disappoint y’all, but the inefficiencies in government are not markedly greater than those in private commerce. There are some costs associated with the fact that governments are required to bid out everything and cannot keep any trade secrets, but that is inherent to conducting government in the sunshine. Civil service makes it harder to fire folks, but that is the price of avoiding a spoils system where jobs can be obtained mainly through political connections and contributions. Because government conducts its business in public, fraud and inefficiencies generally come to light as quickly as the press or an incumbent’s challenger can discover them.
The remaining avoidable inefficencies do not even begin to fill the gap between 12.5% in annual inflation and the less than 2% that existing revenue sources can grow annually. So, the city government can either find a new income source or slash city services by 10% or so every year.
What would you do if you were on the Cupertino City Council?
The high-tech firms can’t avoid the problem by moving. Apple can certainly find a city that would welcome it, but in just a few years that city would be facing the same issues. Example: Austin—besides being Apple’s second-leading jobsite—built a reputation as “The Live Music Capital of the World,” but very few musicians can afford to live there any more. The traditional low-income areas are being gentrified as fast as San Francisco’s were a few years back, and there is limited affordable housing for the displaced population. Traffic has become a crushing burden on the commuters who are being forced to move farther and farther from their jobs.
Why do you need to raise the RATE of taxation if the VALUE of the property rises? You still get a higher amount.
Again, you ignore the effect on those “low-income” brackets when the jobs they perform eventually get a higher dollar amount.
Also, when you TAX a job producer to assist those not working, you create a vicious cycle.
If the people who can’t afford to work and live in that area simply move away (like people did for centuries before the 20th) then the NUMBER of low-wage earners is thinned and the pay rates will go up.
When the government subsidizes people to stay in an area with no job future, you get ghettos. Even in rural Mississippi I saw this.
Don’t encourage people to stay in areas that they can’t afford.
Read my post again. The total tax bill on a California property can only rise by 2% annually, no matter how much the value rises. When the cost of providing required services is rising by 12.5%, there is a shortfall.
I’m not talking about financing government services to subsidize the homeless. I’m talking about the additional police, courts, hospitals, and so forth needed to protect everybody, including those who aren’t homeless.
You cannot reduce the number of low wage earners beyond a certain level unless the people living in those $2.3 MM houses are going to haul their own garbage, maintain their own streets, and cook their own Big Macs.
I see what you mean to a point but no, the free-market side (vs the gubment) WILL make up for the need with higher wages.
I’ve seen it in Aspen, CO, Reston, VA and Highland Park, TX.
SURELY The Late Great Golden State can keep up with those podunk places.
your post is 100% defense of government and taxes totally absent the causes and affects two sides and balance of the story is not in your vocabulary
any “employee tax” will come from the employee through lower wages.
Love it when leftist politicians battle leftist companies. At least the latter produces great products, whereas the former produces nothing but jealousy, class division, and ethnic resentments. Pass the popcorn.
You know California (and all Democrap fat cats) just love any and all taxes they implement. The more, the merrier. Soak everybody, even the poor people that they supposedly support. They can all Go To Hell.
If the purpose of the tax is to solve the public transportation problem, Apple should agree to pay it and dump the busses they are using to move their own people around town to and from work. Once the city picks up the bill for that, Apple should be good to go with picking up part of that bill.
Before I forget –
That’s exactly why Apple *shouldn’t* pay the bill! They are already helping alleviate the problem this is intended to fix!
Before I forget –
(I guess the webpage was trying to render that tag! Oops!)
Screw it. I was trying to end the sarcasm cleverly. I blew it. Twice. Peace!