Known as Proposition C, the measure establishes a variable tax on companies with gross revenues over $50 million. Members of the Bay Area's business community have publicly sparred over the proposal. Salesforce CEO Marc Benioff has been one of its staunchest advocates while Twitter and Square CEO Jack Dorsey has called the plan ineffective. Stripe CEO Patrick Collison has also opposed the plan.
"Prop C's victory means the homeless will have a home and the help they truly need!" Benioff tweeted Tuesday night. "Let the city come together in Love for those who need it most! There is no finish line when it come to helping the homeless. Thank you amazing supporters of Prop C!"
Dorsey and Collison haven't commented on social media about the results of the vote.
Part of the opposition stems from the plan to tax companies based on their gross receipts, rather than net income. This means the tax could eat into the profits of businesses with high gross revenue but narrow margins.
The amount businesses will be taxed depends on their industry. The highest rate--0.69 percent--will be reserved for businesses in the administration and support services industry and the private education and health services industries. Retailers and wholesalers will be charged 0.175 percent of their taxable gross receipts, while companies offering financial services--like Stripe and Square--will be taxed at a rate of 0.60 percent. Information services companies like Salesforce would be subject to a tax of 0.50 percent.
Voters approved Prop C by a 60 percent majority, but the measure still faces a legal hurdle. Although California's Supreme Court ruled in 2017 that a simple majority is enough to pass tax measures introduced by citizen petition, a pending legal case in the state could invalidate that decision, reverting back to a two-thirds or 66 percent voter approval requirement for tax proposals with specific purposes.