Guest commentator: Ashley Miscevich, Manager, Local Government Advocacy and Engagement, The Chamber of Commerce for Greater Philadelphia

After a sustained lobbying campaign advanced by the Chamber and the Inclusive Growth Coalition (IGC), City Council voted to further reduce wage and business taxes – the most in over a decade. Mayor Kenney’s support sends a clear message that our city values and prioritizes its entrepreneurial community.

The measures passed out of the Committee of the Whole and had first reading in Council on Thursday, June 8, and were formally approved as part of the city’s $6.2 billion FY24 budget on Thursday, June 22.

As passed, the plan includes: 

  • Business Income and Receipts Tax (BIRT) lowered from 5.99% to 5.81%
  • Resident City Wage Tax lowered from 3.79% to 3.75% 

The Chamber’s Local Advocacy Team worked with Councilmembers Katherine Gilmore-Richardson and Isiah Thomas, who led our related efforts in FY23, to lead the charge once again.  Gilmore-Richardson offered the city wage tax reduction budget amendment and Thomas offered the BIRT amendment. We could not have achieved this favorable outcome without their continued collaboration and support.

The Chamber team remains vigilant with our advocacy and messaging, pushing for increased investments and informing our Councilmembers and the public that revenue is available to decrease both the city’s wage and BIRT Taxes. 

Who is the Inclusive Growth Coalition (IGC)? 

The IGC advocates for job and business growth in Philadelphia through the engagement of diverse partners from every corner of the city to raise the standard of living for all Philadelphians. In addition to the Chamber, core partners include the Diverse Chambers Coalition of Philadelphia – the African-American Chamber of Commerce of PA, NJ, and DE; the Asian American Chamber of Commerce of Greater Philadelphia; the Greater Philadelphia Hispanic Chamber of Commerce; and the Independence Business Alliance (LGBTQ+)

Why do we need reductions to the city wage tax and BIRT?  

  • Continued reductions to wage tax and BIRT will grow businesses and grow jobs.  
  • Philadelphia has the “highest in the nation” wage tax. It is the only major city in the country that double taxes businesses with the BIRT and corporate net income tax (CNIT). This makes it difficult to attract and retain businesses and talent and create jobs.  
  • Jobs solve problems. Increasing the number of good-paying jobs in Philadelphia provides more revenue for the city to fund the public services essential to help create safer streets and cleaner neighborhoods.  

How does our current tax structure impact small and minority-owned businesses? 

  • BIRT has an outsized impact on small and minority-owned businesses.  
  • While many business owners and workers struggle to make ends meet because of inflation, ongoing supply chain issues, and increasing overhead costs – Philadelphia’s business owners have double the tax burden of their peers in other metros.
  • Research shows that the presence of locally-owned small businesses is linked to higher job creation and less income inequality. 

How will these reductions impact Philadelphia and the region? 

  • Reductions will “give Philly a raise” by putting more money back in the pockets of Philadelphia residents and the suburban commuters who make up 25% of the city’s workforce.  
  • Reductions will enable local businesses to grow, hire, and invest in their businesses – ultimately creating good, well-paying jobs. 
  • Reductions will attract new businesses and foster the growth of family-sustaining jobs, which will expand our tax base and revenue, allowing the city to improve services, help reduce poverty, and make our neighborhoods safer.  
  • Reductions will help retain minority-owned businesses, which serve as catalysts for growth.  Many are small- or mid-sized professional service firms or retailers that serve their local communities and partner with larger businesses in order to grow.   

How can you get involved? 

This moment marks a significant step forward for local businesses and serves as a beacon to the state, the nation, and the world. Our continued advocacy will enable Philadelphia to elevate its position as a thriving hub of entrepreneurship, innovation, and economic opportunity. To learn more about this important work or further engage, please contact Ashley at amiscevich@chamberphl.com.