Council Members Zac Unger and Janani Ramachandran, working closely with the Mayor’s Office, have proposed Measure C, an Oakland Business Relief Program aimed at providing tax relief to new and existing small businesses. The measure will be voted on during a Special Municipal Election on June 2, 2026, alongside the Statewide Primary Election.
The Small Business Incentive seeks to eliminate the gross-sales tax for businesses that do not gross more than $1M in sales for the tax year beginning Jan 1, 2027 and ending Dec. 31, 2027; and be in good standing (timely complete payments during the previous two tax years). The goal is to boost tax revenues over the long term.
The proposal addresses longstanding financial challenges faced by 40 percent of Oakland businesses (those earning less than $1 million annually with nine or fewer employees) by exempting them from paying the gross receipts tax in 2027 for the 2026 calendar year. This effort is specifically intended to support neighborhood businesses such as retail shops, restaurants, and salons—key drivers of foot traffic and community vitality.
City leaders seek to address the mounting challenges faced by many Oakland businesses, including rising operational costs, public safety concerns, and increased competition from e-commerce and delivery services. By easing initial financial burdens, the proposal aims to help business owners establish sustainable operations while also attracting new businesses to the city.
New Business Incentive: Who Is Eligible?
The measure also includes a New Business Incentive, under which eligible new businesses would receive a gross receipts tax exemption of up to $1 million in calendar year 2027, for taxes paid in April 2028. To qualify, a business must not have had a physical location in the city during the previous two years.
Each of these incentives are potentially extendable for three years.
“We understand that businesses have a choice of where they want to go in the world, and we’re trying to do anything we can to entice businesses to come here, so new businesses that come to Oakland during this time period will not pay taxes for their first year,” said Council Member Unger at a recent Town Hall.
Council Member Zac Unger talked about a tax holiday for small and new businesses at the April 9th District 1 Town Hall at Chapel of the Chimes.
All business categories are eligible, including retail sales, grocers, personal and business services, recreation and entertainment, and manufacturing, provided the business is establishing a new location in a commercial space in Oakland between January 1, 2027, and December 31, 2027. This corresponds to the tax year beginning January 1, 2028, and ending December 31, 2028.
In anticipation of this legislation, the Oakland City Council set aside $3 million for the program as part of the FY 2025–2027 Adopted Budget passed in June 2025—approximately double the amount the City expects to forgo in business tax revenue.
If adopted by voters, the program would use this allocation to offset near-term revenue impacts while positioning Oakland for long-term economic growth. Should the Council choose to extend the program, about $1.6 million would need to be set aside annually.
The Oakland Business Relief Program reflects a broader effort to promote job creation, activate underutilized commercial spaces, and reinforce Oakland’s reputation as a dynamic hub for local enterprise.
