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Will Mayor, Council O.K.
Tax Reform Proposals?
It's what an overwhelming majority of voters said they wanted. So the Tax Reform Commission voted for what they wanted and that was no easy task.
It took 10,000 hours to put together their long awaited report on how to give Philadelphians a better and fairer tax structure.
It also required the input of a force made up of volunteers, government officials, consultants, and staff members. They, in turn, distilled the testimony of over 30 experts on municipal funding, testimony from scores of concerned citizens and owners of medium sized neighborhood businesses as well as major industry.
Now the Philadelphia Tax Reform Commission has it all together. It will present its report to the city's officials at the Academy of Music Ballroom, next Tuesday from 10am to noon.
According to Edward A. Schwartz, former councilman and head of the Commission, the report is designed to reduce and restructure city wage, business and real estate taxes over the next 10 years.
"The core of our recommendations are to move relentlessly forward in revising our tax system and reducing particular taxes that have made us uncompetitive as a city," said Edward Schwartz. "We believe these reductions and reforms undertaken over time will make us more competitive and help the city attract and retain residents and employers."
The Commission voted 14-1 to approve tax recommendations that relied on an incremental approach for tax reform.
It is expected the Administration of Mayor John F. Street and the City Council will give serious consideration to many of the suggested reforms. But that maybe all they will do, since the city is facing a budget crunch particularly in its labor costs and with its burgeoning pension responsibilities.
Among the suggestions they will be studying, nevertheless, are quickly adopting a single-sales factor apportionment tax formula to make it more attractive for businesses to stay in the city and the elimination of the business privilege tax.
What may find tough sledding is the Commission's suggestion to phase in Land Value Taxation so that, at the end of 10 years, 50 percent of all real estate tax revenues will be generated from a tax on the value of Land and 50 percent from a tax on the value of structures. The city administration is thought to welcome the idea, but they see a high cost to the transfer process.
The Commission also urges the continuation of a program of significant cuts in wage, earnings, net profits, and school income taxes paid by residents and non-residents. These cuts would be phased in incrementally through fiscal year 2014 to reach a wage tax rate of 3.25 percent for both residents and non-residents A deeper reduction of 3 percent for residents and 2.5 percent for non-residents is proposed if Governor Ed Rendell' s tax-plan becomes law.
The complete package of tax recommendations may be viewed on the Tax Reform Commission's website:
www.philadelphiataxreform.org
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