This page summarizes the application of San Francisco’s Homelessness Gross Receipts Tax for tax years beginning in 2025 following the adoption of Proposition M. View pre-Proposition M rules for 2024 and prior years here.
The Homelessness Gross Receipts Tax imposes an additional gross receipts tax of 0.164% to 1.640% on businesses engaging in business within the City, generally measured by the business’s gross receipts from taxable business activities attributable to the City. The tax generally applies to business activities from which the business generates San Francisco gross receipts of over $25 million. These were recently revised with passage of Proposition M in November 2024. Learn more about the impacts. Businesses that pay the administrative office tax will pay an additional tax of calculated as 1.5% of their payroll expense in San Francisco.
The Homelessness Gross Receipts Tax is filed as part of Annual Business Tax Returns.
Exemptions
- Certain nonprofit organizations so long as those exemptions continue to exist under state or federal law.
- Businesses exempt from local taxation, such as banks and insurance companies.
- Receipts that are exempt from the Gross Receipts Tax.
Exclusions
Rent-Controlled Buildings
A taxpayer may exclude 50 percent of the total amount received from the rental of residential real property located in San Francisco that is occupied by tenants, and subject to rent-increase limitations under the City’s Residential Rent Stabilization and Arbitration Ordinance (Administrative Code Chapter 37).
Certain Sales of Real Property
Gross receipts do not include receipts from any sale of real property on which the San Francisco Real Property Transfer Tax (Article 12-C) has been paid.
Commercial Rents Tax
Receipts that are subject to the Early Care and Education Commercial Rents Tax (Article 21) are excluded from the Homelessness Gross Receipts Tax.
Homelessness Gross Receipts Tax rates vary depending on the amount of San Francisco gross receipts and Business Activity Category. With the passage of Proposition M, the Homelessness Gross Receipts Tax now applies to business activities with San Francisco gross receipts over $25 million.
| Category | 1 | 2 | 3 | 4 | 5 | 6 | 7 |
| $25M-$50M | 0.164% | 0.162% | 0.000% | 0.246% | 0.574% | 1.148% | 0.328% |
| $50M-$75M | 0.164% | 0.284% | 0.325% | 0.410% | 0.656% | 1.476% | 0.492% |
| $75M-$100M | 0.164% | 0.284% | 0.325% | 0.410% | 0.656% | 1.476% | 0.492% |
| $100M-$150M | 0.164% | 0.284% | 0.325% | 0.574% | 0.656% | 1.640% | 0.656% |
| $150M-$250M | 0.246% | 0.284% | 0.325% | 0.574% | 0.738% | 1.640% | 0.656% |
| $250M-$500M | 0.328% | 0.284% | 0.325% | 0.656% | 0.820% | 1.640% | 0.738% |
| $500M-$1B | 0.410% | 0.284% | 0.325% | 0.656% | 0.820% | 1.640% | 0.738% |
| Over $1B | 0.492% | 0.284% | 0.325% | 0.738% | 0.820% | 1.640% | 0.820% |
Estimated business tax payments are due April 30th, July 31st and October 31st. Residential Landlords with $5,000,000 or less in gross receipts in the current or prior tax year are generally exempt from estimated business tax payments. Learn more about estimated quarterly payments.
It appears that PG&E has been collecting a “PROP C TAX SURCHARGE” from its San Francisco customers, and is mischaracterizing the surcharge as a tax that Proposition C requires to be collected from its customers. Proposition C imposes the tax on businesses, not the business’ customers. Although PG&E obtained a ruling from the California Public Utilities Commission allowing it to impose and collect a surcharge despite the City’s objections, Proposition C does not require businesses to shift their tax burden to their customers by way of any surcharge.
- Article 28: Homelessness Gross Receipts Tax Ordinance
History of the Homelessness Gross Receipts Tax
In November 2018, San Francisco voters approved Proposition C, imposing an additional tax beginning in 2019 on businesses engaging in business withing the City with over $50 million in taxable gross receipts, to fund homeless services. In November 2024, San Francsico voters approved Proposition M, which applies the Tax to business activities with San Francisco gross receipts of more than $25 million, and updates the business activity categories and rate structure.
Homelessness Gross Receipts Tax Now Applies to Business Activities with San Francisco Gross Receipts Over $25 Million
Beginning in 2025, businesses engaging in business in San Francisco with gross receipts over $25 million in a Business Activity Category generally are required to file and pay the Homelessness Gross Receipts Tax. Proposition M revised the base of the Homelessness Gross Receipts Tax by changing the threshold from $50 million in combined gross receipts to $25 million in San Francisco gross receipts in a Business Activity Category. View sample business impacts below.
These are simplified examples of hypothetical businesses for purposes of showing relative tax liabilities pre- and post-Proposition M. Businesses may not rely on these examples for purposes of calculating their tax liabilities, and must calculate their tax liabilities under the Business and Tax Regulations Code.
Restaurant
(Described in NAICS Code 722 - Food Services and Drinking Places)
Business Activities Only in San Francisco
Gross receipts: $26 million
2025
| Without Prop M | Prop M | Variance |
Gross Receipts Tax | $98,710 | $46,810 | -53% |
| Homelessness Gross Receipts Tax | $0 | $1,640 | 100% |
Business Registration Fee | $16,124 | $15,000* | -7% |
Total Tax Obligations | $113,089 | $63,450 | -45% |
*Nine-month transition period.
Retail Business
(Described in NAICS Codes 44 and 45 – Retail Trade)
Business Activities Inside and Outside of San Francisco
Total gross receipts: $300 million
20% payroll factor (percent of total payroll in San Francisco)
$30 million in gross receipts allocated to San Francsico under Section 956.1
2025
| Without Prop M | Prop M | Variance |
Gross Receipts Tax | $79,115 | $85,450 | 8% |
Homelessness Gross Receipts Tax | $0 | $20,500 | 100% |
Business Registration Fee | $9,674 | $15,000* | 55% |
Total Tax Obligations | $88,789 | $120,950 | 36% |
*Nine-month transition period.
Financial Services Company
(Described in NAICS Code 523 - Securities, Commodity Contracts, and Other Financial Investments and Related Activities)
Business Activities Inside and Outside of San Francisco
Total gross receipts: $200 million
20% payroll factor (percent of total payroll in San Francisco)
$25 million in gross receipts allocated to San Francsico under Section 956.1
2025
| Without Prop M | Prop M | Variance |
SF Gross Receipts Tax | $335,440 | $800,700 | 139% |
| Homelessness Gross Receipts Tax | $0 | $43,050 | 100% |
Business Registration Fee | $14,379 | $15,000* | 4% |
Total Obligations | $349,819 | $858,750 | 145% |
*Nine-month transition period.
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