Twitter is threatening to leave San Francisco and take 350 employees to a new office in Brisbane that will be shared with Wal-Mart according to the SF Guardian.
It is threatening the city saying that if it does not get a payroll tax exemption that would cap the company’s future tax bills at $250,000, it would leave.
Apparently, city officials are nervous – losing a world famous high-tech outfit that has plans to double its workforce in the next few years would be a blow to the city’s reputation as a technology incubator.
So the Mayor’s Office of Economic Development is scrambling to cut a deal with Twitter. Jane Kim, who represents the city district said: “Twitter has delivered a very clear message: either give us the tax break or we’ll leave.”
The Guardian calls it “corporate blackmail”, saying that Twitter cannot leave even if it wanted to because most of its employees live in the city and it would be a logistical nightmare to transport its employees back and forth to Brisbane. In the end Twitter will not end up saving any money.
Further, the city cannot give Twitter a tax break even if it wanted to – the break would have to be given to all companies in that geographic zone. So the supervisors would either have to give tax breaks to a lot of other tech companies and it will not sit well with other companies if only Twitter gets the tax break.
Silicon Valley watcher Tom Foremski, writes: “Twitter Touts “Social Responsibility” But Threatens To Leave SF Over Local Taxes”
Channels: tax breaks, Twitter
When I went to see Ev Williams and Biz Stone at the Inforum Club in October, they spoke a lot about how social responsibility is very important to Twitter. It felt disingenuous, it felt as if it was “bolted on” for PR value.
It seems my instincts weren’t wrong.
How does Twitter square away its PR about it being a socially responsible company yet threaten to leave San Francisco unless it gets a tax break?
Those taxes are part of its social responsibility to the local community.
Clearly at Twitter, chatter about social responsibility is more important than actual social responsibility.
Social responsibility can’t be tweeted. Let’s see it in action. Pay your local taxes Twitter.
San Francisco should call Twitter’s bluff and let it move to Brisbane, to a site shared with Wal-Mart. It’ll have a big problem trying to recruit engineers to work in Brisbane. And that will cost it far more than its savings on taxes.