PHILADELPHIA | 3001 JFK Boulevard | Schuylkill Yards | 512 FT | 34 FLOORS

[allovertown]

Originally Posted by summersm343

I would argue yes. More companies paying slightly less in taxes is FAR better than less companies paying slightly more in taxes. Overall, it generates more tax revenue. As well, it brings more people into the city, living here or commuting here, which in turn generates more tax revenue as well.

Business taxes in Philadelphia need to be lowered - plain and simple. Wage tax needs to be lowered to 2%

If only there was any evidence of any city lowering taxes and then immediately bringing in more tax revenue. Like ever. In history.

Doing something like that is a long term idea. You'd have to be willing to suffer through some lower revenue years while you waited for the tax base to build up as a result of the lower taxes. And even then, the data on lowering business taxes resulting in bringing in more business tax revenue, even over extended periods of time, is spotty at best.

Right now, while the city is weathering a financial crisis, is ABSOLUTELY not the time to do something like this.

[City Wide]

Originally Posted by summersm343

I would argue yes. More companies paying slightly less in taxes is FAR better than less companies paying slightly more in taxes. Overall, it generates more tax revenue. As well, it brings more people into the city, living here or commuting here, which in turn generates more tax revenue as well.

Business taxes in Philadelphia need to be lowered - plain and simple. Wage tax needs to be lowered to 2%

Very few people like paying taxes---plan and simple; if the wage tax were set at 2% you and many others would be pushing for 1.5%, and so on. If taxes are lowered then either programs (expenses) need to be cut and/or efficiencies in running the programs need to improve. Only the federal gov't can borrow money to pay its operating cost.

On this forum people are regularly asking for better maintained streets that are regularly cleaned and better schools, just to name two issues. Those and other items aren't going to happen if the City cuts taxes. Sure there are more complicated methods of changing the tax structure around, such as higher taxes for land, that might look great on paper but don't have nearly enough support to even get to the table for discussion. Meaning there is a small window where changes can be made.

The 10 year tax abatement on real estate taxes seems like it was a program that worked largely as hoped for. It didn't cost the City anything from its purse and it didn't lower taxes, but it gave people a way of avoiding higher taxes for a period of time. I'd like to see similar set ups proposed for other possible areas of growth in the City, and not just helping a big time law firm to move 8 blocks or something like that. Growth is different from moving the same pieces around on the playing field.

[thoughtcriminal]

Originally Posted by allovertown

If only there was any evidence of any city lowering taxes and then immediately bringing in more tax revenue. Like ever. In history.

Doing something like that is a long term idea. You'd have to be willing to suffer through some lower revenue years while you waited for the tax base to build up as a result of the lower taxes. And even then, the data on lowering business taxes resulting in bringing in more business tax revenue, even over extended periods of time, is spotty at best.

Right now, while the city is weathering a financial crisis, is ABSOLUTELY not the time to do something like this.

well if they don't, this financial crisis will get worse because more business, especially small businesses, will go under. Not all just because of taxes, but lowering taxes could certainly make the difference between closing and staying open for some businesses. Certainly lowering taxes will help.
And maybe the city should do some things on their end, like cutting some spending.

[allovertown]

Originally Posted by thoughtcriminal

well if they don't, this financial crisis will get worse because more business, especially small businesses, will go under. Not all just because of taxes, but lowering taxes could certainly make the difference between closing and staying open for some businesses. Certainly lowering taxes will help.
And maybe the city should do some things on their end, like cutting some spending.

Please do tell. What would you like to cut from the budget?

Budget shortfall is approaching one billion dollars out of a five billion dollar budget. And you want to cut taxes. Which would increase that shortfall even further. So you should really get ready to do some serious cutting.

I'm all for cutting the police budget, but even the entire police budget is only about three quarters of a billion dollars, and I gotta say, maybe accuse me of not being bold enough, but I think entirely eliminating the police would probably be a mistake. So, what then? Maybe eliminate trash pick up? Close half the city's schools? Eliminate the Fire Department?

Oh not that stuff? You mean the wasteful stuff? Like funding for the arts? Hmm. Don't think 1.25 million in funding for the arts is going to get you very far.

Seems like cutting a billion plus dollars from the budget will be pretty tough, but hey, I'm open to suggestions.

Small businesses will be hurt by this, but unfortunately Philly is no position to offer any relief. Not that tax relief would be enough to save most struggling small businesses right now anyway. Philly has to fund every penny in their budget, and it is struggling to pay for the essentials right now even before you consider a tax cut. Only the federal government is capable of borrowing money to pay for the kind of relief that small businesses, not just in Philadelphia, but across the country need right now, and unfortunately they've been entirely derelict in their duties. Does not change the fact that Philadelphia cutting taxes right now is a fantasy.

[Knight Hospitaller]

I'm loathe to get into the tax discussion, but here's a novel idea: Put the entire budget under a public microscope and cut everything but essential services (pennies add up to dollars). We've been told for months what's essential for survival and what's not, so maybe the public should have a say in what they want from government and what can go away. I'm sure that essential services could find some cost savings too. After that's done, maybe (just maybe) you can persuade people to raise enough more in taxes to cover the shortfall (remembering that increased revenues don't just come from percentage increases, but from decreases that encourage economic activity). Clearly one of the biggest obstacles to serious conversation about taxes is the feeling that tax increases just go to make sure that the current level of waste is maintained or increased. Folks seem to think taxes are a zero sum game, but the drivers of economic activity and tax revenue can pick up their ball and go play in another field if they aren't getting value for their tax dollar. I'm no billionaire, but where I've chosen to live (and houses that we've passed on) is tied to local taxes. Not the only factor, but a huge one.

[allovertown]

Originally Posted by Knight Hospitaller

I'm loathe to get into the tax discussion, but here's a novel idea: Put the entire budget under a public microscope and cut everything but essential services (pennies add up to dollars). We've been told for months what's essential for survival and what's not, so maybe the public should have a say in what they want from government and what can go away. I'm sure that essential services could find some cost savings too. After that's done, maybe (just maybe) you can persuade people to raise enough more in taxes to cover the shortfall (remembering that increased revenues don't just come from percentage increases, but from decreases that encourage economic activity). Clearly one of the biggest obstacles to serious conversation about taxes is the feeling that tax increases just go to make sure that the current level of waste is maintained or increased. Folks seem to think taxes are a zero sum game, but the drivers of economic activity and tax revenue can pick up their ball and go play in another field if they aren't getting value for their tax dollar. I'm no billionaire, but where I've chosen to live (and houses that we've passed on) is tied to local taxes. Not the only factor, but a huge one.

I'm all for trimming some fat and eliminating waste and I totally agree that even essential services, especially the police could stand to receive some cuts and no one will miss them. When you're facing shortfalls like this, you gotta put everything on the table. I just find it hard to believe you're going to come up with a billion dollars worth of fat to trim.

And I remain behind shifting tax burdens around in ways that would be revenue neutral but would make Philly a more appealing place to live and work. Things like shifting property tax burdens from improvements to land or cutting the wage tax while making corresponding increases to business taxes, etc.

I understand there can be benefits to lowering taxes of course. I was simply stating that right now is not the time to just start cutting taxes in the hopes that companies move in for the low taxes and the tax cut becomes revenue neutral a decade from now and starts providing additional revenue in 2035. Stuff like that may be sound policy at some point, but that time is not now.

[iamrobk]

Originally Posted by Knight Hospitaller

I'm loathe to get into the tax discussion, but here's a novel idea: Put the entire budget under a public microscope and cut everything but essential services (pennies add up to dollars).

https://www.phila.gov/finance/reports-BudgetDetail.html

Have at it.

[Knight Hospitaller]

Originally Posted by iamrobk

https://www.phila.gov/finance/reports-BudgetDetail.html

Have at it.

My first endorsement for Emperor!

[cardeza]

Originally Posted by City Wide

Very few people like paying taxes---plan and simple; if the wage tax were set at 2% you and many others would be pushing for 1.5%, and so on. If taxes are lowered then either programs (expenses) need to be cut and/or efficiencies in running the programs need to improve. Only the federal gov't can borrow money to pay its operating cost.

On this forum people are regularly asking for better maintained streets that are regularly cleaned and better schools, just to name two issues. Those and other items aren't going to happen if the City cuts taxes. Sure there are more complicated methods of changing the tax structure around, such as higher taxes for land, that might look great on paper but don't have nearly enough support to even get to the table for discussion. Meaning there is a small window where changes can be made.

The 10 year tax abatement on real estate taxes seems like it was a program that worked largely as hoped for. It didn't cost the City anything from its purse and it didn't lower taxes, but it gave people a way of avoiding higher taxes for a period of time. I'd like to see similar set ups proposed for other possible areas of growth in the City, and not just helping a big time law firm to move 8 blocks or something like that. Growth is different from moving the same pieces around on the playing field.

Got to love Americans. People want more spending at the same time they are advocating for less revenue for the government.

[cardeza]

Originally Posted by iamrobk

https://www.phila.gov/finance/reports-BudgetDetail.html

Have at it.

As I'm sure you know, those with simplistic solutions could never be bothered to read even 5 pages of a budget document. Why get bogged down with details when you can solve everything with a few brilliant keystrokes?

[eixample]

What about pension reform? The state did a pension reform bill a few years ago so new employees are on a combined pension/401(k)-ish plan. I don't think the city did the same but maybe I'm wrong. It's not instant money in the budget but in the long run it would pay off.

[City Wide]

A bit of a reality check----in broad terms in the last ten years the City revenue has increased by a ton, which is a very technical term, but I don't think many of us would claim that City services have increased by more then a few pounds. My point is that if the City hasn't been able to get their financial house in order when the revenue stream had been growing every year, its hard for me to believe that will happen when the City is in the hole for almost a cool Billion. I think its laughable that one of the simple solutions tossed out is throw the dumb demos out of office and replace them with repo repubs, as if they have done anything in Harrisburg to be proud of. But the idea of continuing to get new blood into City Council, regardless of the party name, is appealing, and it would be nice to get a couple of people who don't think their mission is to spend $10 for every $9 the City brings in. I wish council had term limits so getting re-elected wasn't a full time career.

[iamrobk]

Originally Posted by eixample

What about pension reform? The state did a pension reform bill a few years ago so new employees are on a combined pension/401(k)-ish plan. I don't think the city did the same but maybe I'm wrong. It's not instant money in the budget but in the long run it would pay off.

This happened; it's called Plan 16, if you want to look it up. Replaced Plan 10, which was optional (you could opt out and join Plan 87). AFAIK from ~2017 on, everyone who joins the city has to join Plan 16.

[cardeza]

Originally Posted by eixample

What about pension reform? The state did a pension reform bill a few years ago so new employees are on a combined pension/401(k)-ish plan. I don't think the city did the same but maybe I'm wrong. It's not instant money in the budget but in the long run it would pay off.

There have been many tweaks over the years as each contract is negotiated that reduce what CURRENT employees can get out of the system. The debts being paid today are from contracts negotiated by Rizzo. YOu cannot get out of pension obligations without going bankrupt first.

[cardeza]

Originally Posted by City Wide

A bit of a reality check----in broad terms in the last ten years the City revenue has increased by a ton, which is a very technical term, but I don't think many of us would claim that City services have increased by more then a few pounds. My point is that if the City hasn't been able to get their financial house in order when the revenue stream had been growing every year, its hard for me to believe that will happen when the City is in the hole for almost a cool Billion. I think its laughable that one of the simple solutions tossed out is throw the dumb demos out of office and replace them with repo repubs, as if they have done anything in Harrisburg to be proud of. But the idea of continuing to get new blood into City Council, regardless of the party name, is appealing, and it would be nice to get a couple of people who don't think their mission is to spend $10 for every $9 the City brings in. I wish council had term limits so getting re-elected wasn't a full time career.

the city budget has to be balanced every year. Its better run than the federal government in those terms. PA has to have balanced budget as well but they balance it using gimmicks and accounting tricks since the legislature refused to raise any tax for any reason. The city budget is more sound than either of the other two

[eixample]

Originally Posted by iamrobk

This happened; it's called Plan 16, if you want to look it up. Replaced Plan 10, which was optional (you could opt out and join Plan 87). AFAIK from ~2017 on, everyone who joins the city has to join Plan 16.

That's good to hear. It's hard to find details about it online, but this appears to be how it works -->

Newly hired, nonuniformed employees in the hybrid plan get a traditional defined benefit pension on earnings up to $65,000, and the defined contribution plan for earnings above that level.

[cardeza]

Originally Posted by eixample

That's good to hear. It's hard to find details about it online, but this appears to be how it works -->

There have been several changes to make retirement less lucrative going all the way back to Rendell but they only help once the employees hired under that plan retire so it takes decades to reap the benefits. Pension reform is a very slow process and its not something that generates short term budget savings.

[hammersklavier]

I thought there was, oh I dunno, a building somewhere in this thread?

[Boku]

Originally Posted by hammersklavier

I thought there was, oh I dunno, a building somewhere in this thread?

Two buildings!

[TempleGuy1000]

If anyone is curious, the 'exciting announcement' just ended up being the official lighting of the Bulletin building sign. They did post a nice video of it.

https://www.instagram.com/p/CFfRQa1jEOt/