PHILADELPHIA (KYW Newsradio) — Philadelphia Mayor Cherelle Parker is expected to announce a restructuring of city taxes when she introduces her $6.7 billion budget to City Council on Thursday.
Last year, Parker ended the gradual reduction in wage and business taxes pursued by her predecessors, leaving the rates the same. This year, however, sources familiar with her budget proposals said she will resume the cuts with a goal of reducing the net income portion of Business Income Receipts Tax (BIRT) by more than 50% by 2039. It would go from the current 5.8% to 2.8%. The gross receipts portion of the BIRT would be eliminated.
Additionally, the wage tax for residents would go from 3.75% to 3.7% by 2030. Non-residents would see a similar reduction.
The proposal is in keeping with recent recommendations from the Tax Reform Commission. The sources said the mayor will propose an increase in the Real Estate Transfer Tax — already among the highest in the country at 4.27% — to help pay for her Housing Opportunities Made Easy (H.O.M.E.) plan to add 30,000 units of housing.
There will be no property tax increase, sources said, and the mayor will propose giving a slightly higher percentage of the property tax to the school district.
Parker is also poised to propose an increase in parking meter rates in greater Center City.
The budget is said to include borrowing of $800 million for the H.O.M.E. plan. It also reportedly puts $100 million ($75 million in capital funds and $25 million for new staffing) into the Riverview Wellness Village, which recently opened on State Road for people leaving addiction treatment.
The budget is also said to include a $95 million reserve fund to protect against the loss of federal grants.