On November 3, 2011 City Council passed two bills that would effectively curtail and hopefully eliminate the business privilege tax as we know it in Philadelphia. One bill, by Councilman Bill Green and Councilwoman Quinones-Sanchez, will:
· Reduce the business privilege tax for small, city based businesses.
The other bill, introduced by Councilman Jim Kenney, will:
· Help new business grow and develop by eliminating start- up fees and exempting businesses from the business-privilege tax during the first two years.
The bills intend to reduce the tax burden on those new and small businesses inside Philadelphia county which have long paid more taxes then those located outside the city.
Most of Mr. Kenney’s bill will begin during the tax year 2012, but the Green/Quinones-Sanchez bill won’t take effect until tax year 2016.
The Nutter administration successfully argued that the Green/ Quinones legislation should be postponed… they believe it could cost the city as much as $33 million each year in lost tax revenue.
We believe the City Administration is forgetting one vitally important aspect to this argument
…it simply doesn’t take into account the potential for new growth in business and wage taxes.
Simply stated if you lower the taxes new businesses will come to Philly and the result will be more growth not less in business and wage taxes.
We believe new legislation should be submitted immediately that would move the Green / Quinones-Sanchez bill into effect now instead of waiting for 2016. This new initiative would truly signal that the City leadership is for real tax reform.