Twitter, Tech Firms Receive Tax Cuts For Charitable Contributions

Twitter, along with six other tech companies based in San Francisco, will be provided with local tax breaks from the city for providing charitable contributions. Twitter, in particular, will get tax cuts if it offers Promoted Tweets to local agencies for free. Other requirements include volunteer work in the community and promoting local enterprises. The tax deal was defined in the Community Benefits Agreement draft, which is bound to be official by January 30, 2013. The promotional efforts aim to improve the economic position of local businesses in San Francisco. Generally, companies need to pay 1.5 percent payroll tax for workers hired after the company sets up in the community. Should the tech companies agree to the exchange, they will be exempt from such tax. Twitter, ZenDesk and Yammer by Microsoft have already given their approval to such and will be contributing tens of thousands worth of products and services. One Kings Lane, 21 Tech and Zoosk are also included in the list of six. The tax break will span 6 years, wherein Twitter will be exempt from taxes worth around $22 million. Furthermore, the citizen?s advisory committee indicated that it is very important for the tech companies to release their financial estimates for the year so that the committee can determine if the exchange was beneficial to all parties involved. Companies with annual payroll expenses going over $1 million need to sign an official CBA. The companies that will be described as successful are those who have achieved at least 80 percent of the agreed terms and conditions. Each tech company is asked to contribute various things and services. These may include providing grants and computer equipment to schools and government offices. The companies may also be working with other local clubs and organizations for drives, children?s educational programs and campaigns.