Category: Taxation

No comments

Why Conservatives Can Like Pennsylvania’s Personal Income Tax

  By Pennsylvania, Pennsylvania Budget, Pennsylvania State Taxes

Originally published at Third and State, December 14, 2015 Rumors of a sudden interest on the part of Republicans in raising the personal Income tax (PIT) instead of the sales tax to meet the revenue requirements of the budget framework have floated across 3rd Street to our offices at the Pennsylvania Budget and Policy Center. So I’m going to do something unusual for us—and frankly a bit uncomfortable—and give some conservative arguments for preferring the PIT over the sales tax. First, a PIT increase is for three reasons likely to place a smaller burden on businesses than a sale tax increase. For those goods and services on which the sales tax is imposed, the tax is paid on every purchase. It thus dissuades some people from making purchases. It especially dissuades those who live near a border with a state that has a lower sales tax from buying goods in… Continue reading

No comments

PA Sales Tax can be Expanded in an Equitable Way

  By Budget, Pennsylvania, Pennsylvania Budget, Pennsylvania State Taxes, Public Policy, Taxation

Originally published in NewsWorks, December 7, 2015 Legislators have been considering raising new — and necessary — revenue by expanding the sales tax base to include more goods and services instead of increasing the sales tax rate. This would be a good way to raise revenue if it is done in ways that make the tax more equitable. Still a broader sales tax would fall more heavily on low-income families. Legislators could limit the burden on those least able to bear it by coupling the sales tax expansion with a new, refundable sales tax credit. The inequity of the sales tax The original budget framework increased the state’s sales tax rate from 7 percent to 8.25 percent (and from 8 percent to 9.25 percent in Philadelphia). This proposal was opposed by many legislators. Some opposed any tax increase. Others worried that businesses near our borders with other states would lose… Continue reading

3 Comments

David Brooks Gets It Wrong About Education and Health Care

  By Education, Health Care, Taxation

David Books outdid himself today in writing post about education and health care that is completely misleading about improvements in both in the last fifty years and about the limits of productivity increases in both areas. It takes more than a FB status update to explain why. Read this blog post for details. The short story though, is that if you really think there haven’t been any improvements in either education or medical care in this country since 1960, you don’t deserve to have your opinions appear on the op-ed page of The New York Times. And if you think that huge productivity increases in labor intensive fields are possible, then maybe you should explain why NY Times columnists do only two columns a week instead of the three they did in the 1960s. Continue reading

No comments

What’s the Rush? Save the Cohen Wage Tax Rebate!

  By Philadelphia, Philadelphia Taxes, Taxation

One of the last accomplishments of long time progressive Councilmember David Cohen—a rebate on the wage tax for those with low incomes—may be repealed tomorrow. It shouldn’t be. There are good policy arguments both for and against the wage tax rebate. I’ll come to some of them in a moment. But, frankly, at the moment those arguments are secondary. The key reason not to repeal the legislation tomorrow is that the decision to put off AVI for a year means that Council is going carry out a broad examination of taxation in the city next year. The Cohen wage tax rebate is not scheduled to go into effect until 2016 anyway. So there is plenty of time to reconsider it as we think through the future of taxation in Philadelphia. Any city like Philadelphia has to balance considerations of progressivity and economic growth. While, progressive taxation has very little negative… Continue reading

No comments

AVI Without Tears

  By Philadelphia, Philadelphia Budget, Taxation

I have an op-ed in today’s Daily News about AVI. I think the argument there is correct, but it is highly compressed. I’ve tried to set out my argument at a little greater length here. (Note that in the op-ed and in this piece I made a mistake and said that AVI shifts the tax burden from residential to commercial property. It does the opposite. I’ve corrected it here. Councilman Green’s proposals minimize the shift.) So much has gone wrong in the city’s move to the Actual Value Initiative (AVI), that many people are fearful about its consequence. And one of the things that has gone wrong is that people who know better are playing on this fear for their political purposes, I think the fear is over blown. AVI is a good thing if it is implemented properly and I think it can be implemented properly this year. Continue reading

No comments

Homeowners, Don’t Fight the AVI—It’s Good for You

  By Philadelphia, Philadelphia Taxes, Taxation

 Originally published in the Daily News, May 29, 2012 A great fear seems to have come over the city as the heavy footsteps of a monster called AVI come ever closer to us. It’s time to recognize, however, that that monster is a friendly creature who will benefit most of us. Partly because tax matters are hard to understand and partly because Mayor Nutter wants to raise more revenue for schools from the real-estate tax, public discussion of AVI — Actual Value Initiative — has become confused. No one trusts any government, and some people in office or thinking of running for office can’t resist the temptation to be demagogues about any issue. So, the confusion has created the false belief that AVI is just a tax increase in disguise. We desperately need to get back to some basics: AVI is about tax fairness. And, under it, most Philadelphians will see… Continue reading

No comments

Not Such a Big Deal

  By Philadelphia, Public Policy, Taxation

Tom Ferrick wrote an insightful, useful but in some respects strange article about Philadelphia taxes in Metropolis the other day. There is a lot to be learned from him it and as much to be learned from understanding where it goes wrong. (This is the second time in a few weeks I’ve disagreed with Ferrick so let me just say that he’s one of the few writers on Philadelphia politics who is truly indispensable. He make me think hard when I disagree with him. If you don’t read Metropolis, you should.) The end of The Deal Ferrick argues that in moving to AVI, Philadelphia is about to undo what he calls “The Deal.” The Deal is the implicit bargain that the city has made with homeowners: we will pay a stiff wage tax which people don’t pay in the suburbs as well as an extra 2% in sales taxes. But in… Continue reading

One Comment

In Philly, We Need Transparency in Criticism As Well As Budgeting

  By Budget, Philadelphia, Philadelphia Budget, Taxation

Some critics of Mayor Michael Nutter are calling him out for hiding a real estate tax in his new budget since the budget proposes that after the new market based system of setting property values is put in place, tax rates will be set so that the city takes in an additional $90 million in real estate tax receipts. There is a just a little bit of truth in the criticism. But most of it is really just hogwash. Continue reading

No comments

The Imaginarium of Pat Toomey and Kevin Ferris

  By Federal Budget, Health Care, Taxation

Today in the Inquirer, Kevin Ferris channels PA Senator Pat Toomey, who has been providing a Republican spin on the failure of the Super Committee. In the imagniarium of Pat Toomey and Kevin Ferris, the Senator courageously broke with fellow Republicans to propose a balanced, bi-partisan deal that would combine $450 million in tax increases along with $750 million in budget cuts to meet the Super Committee’s ten year goal. In rejecting this proposal, President Obama and the Democrats showed that they don’t truly want a balanced bipartisan solution to the deficit problem. This is what the proposal looks like when you take off the funny glasses. Toomey’s proposal would have raised revenue slightly—no more than $45 billion a year. But most of that increase would have come from the middle class not the rich. Toomey proposed to reduce the marginal tax rates for everyone by 20%. However, the absolute… Continue reading

No comments

Why You Should Go to DC in Support of a Financial Transactions Tax

  By Economic Justice, Occupy Philly, Political Organizing, Progressive Politics, Public Policy, Social Justice, Taxation

Heal America! Make Wall Street Pay! Event The National Nurses Union (NNU) is holding a rally and lobby day this Thursday, December 3, in Washington, DC in support of a financial transactions tax. The event is co-sponsored by the AFL-CIO and other progressive organizations. Here in Pennsylvania, Health Care For America Now (HCAN) is working with the local NNU affiliate PASNAP, to bring people to the rally by bus. The buses are FREE and will leave at 7:00 am from two locations, Temple University Hospital and 16th and JFK Boulevard. After a 11:30 rally, there will be a chance to do some lobbying on Capitol Hill and there may be a meeting with the staff of some of our members of Congress (or, if we can arrange it, the members themselves). The bus will leave Washington to return to Philly at 5:00 pm. Box meals will be provided in both… Continue reading