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Budget fuss: Coalition urges use of "gross receipts" tax to balance budget
Budget fuss: Coalition urges use of "gross receipts" tax to balance budget
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An occasional, inconsistent, and improbable series on this year's budget.
The Coalition for Essential Services – a coalition of labor, service, and community groups dedicated to getting a "fair budget" passed by Council – meaning, in their case, preserving city services and jobs – rallied outside City Hall this morning to get Council's attention focused on what they consider the fairest way to balance the city's budget: raising (or "rolling back" to mid-nineties levels) the "gross receipts" portion of the business privilege tax.
This comes as Mayor Nutter's proposed trash fee appears all but dead, and the sugary beverages tax isn't doing much better. Councilman Frank DiCicco has withdrawn his own alternative, a proposed 12% property tax hike, and Councilman Wilson Goode has introduced a two-year 9% property tax hike instead, apparently backed by democratic Council leadership, to balance the budget.
But Council is just starting to hold its neighborhood community budget hearings, and they're already being told exactly what they were told last year: "don't raise our property taxes."
Is it just me, or is it strange that we spend about half a year waiting for Council to make up its mind on given budget?
Anyway: back to the gross-receipts thing.
The idea is this: the gross receipts tax is a tax on net sales – rather than revenue/income.
Because large companies can easily hide or move their income, the reasoning goes, the gross receipts tax is the only way to tax the operations of major, national retailers in the area.
One of the strongest arguments against raising this tax is that, because it taxes sales regardless of income, it can tax a business that isn't turning a profit. To answer this challenge, the Coalition is proposing that all businesses with receipts under $500,000 be exempted.
It's an interesting idea, and the exemption is clever - I don't think anyone wants to hurt small businesses right now, but getting a better cut from Coca Cola, etc. – it could gain steam.
Council members Bill Green and Maria Quinones-Sanchez have so far been the most interested in potentially revising the gross receipts tax.
Anybody out there want to weigh in on this one? Got a better idea to balance the budget? (And if you're going to say, "cut city jobs," that's fine, but no getting off easy: which department – anyone want to take up the line-item challenge?).
Thanks Isaiah! 40% of big businesses taxed by the GRT (over $500,000 in Receipts and therefore not exempted under our plan) aren't even based in Philadelphia. They rely on our city services to create markets and access for their products. They aren't going to stop selling their products in our city, and they don't provide any jobs for Philadelphia, so taxing them is win-win for us. Zachary H Coalition for Essential Services PhillyCES.org
[...] This post was mentioned on Twitter by philly news now. philly news now said: Budget fuss: Coalition urges use of “gross receipts” tax to balance budget: An occasional, inconsistent, and impr... http://bit.ly/cW0tkT [...]
How about thinking outside the box and limiting the proposed "gross receipts" tax to one full business week of the year.
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