Wage tax vs Property tax (Philadelphia: real estate, home, neighborhoods)

[dsmith181]

In the past we residents have paid the city wage tax and let its ridiculousness go because of how undervalued our property taxes were. Now they have reaccessed everyone's property taxes to their proper values. I know mine have tripled and have talked to some people who have had them quintuple. I have no problem with this, I know that we should be paying a proper percentage of our property's worth. What I do have a problem with is this city wage tax hitting us as well. The city wage tax is supposed to be a tax on people who work in the city and use its amenities and don't pay taxes into it, right? Residents are getting hit at both ends now. We pay the city wage and full property taxes now. This is not right, it's just wrong. We are the 2nd most taxed city in America. Maybe we should look more into how this money is being spent, not just feed more to the fire.
How do we fight this injustice. Anyone?

[rotodome]

I don't think a wage tax is exactly the same thing as a commuter tax; but it's true that a lot more people in the city would have complained about it a whole lot more if it weren't for the unnaturally low property taxes. I think it's been pretty much acknowledged as a terrible system, which is why politicians have been trying to phase out the wage tax for the last few decades.

They can't drop it too quickly unless and until there's something to take it's place (ie: a sane property tax structure), so this is the awkward/painful transition period.

[stylistvg]

Isnt the wage tax supposed to be phased out now?

[rotodome]

It hasn't been phased out yet, but it had been getting incrementally reduced by fractions of a percent for several years, until those reductions were paused for the Great Recession. They should commence again once the economy gets better (" ").

[Ohiogirl81]

In the interest of full disclosure, I pay the city wage tax but do not live in the city. I have no problem with this, and am comfortable contributing toward the city's operations so that the streets are paved and the traffic signals work, and when some bozo runs a red light and smashes into my car, the cops and emergency services will come help me.

Originally Posted by dsmith181

In the past we residents have paid the city wage tax and let its ridiculousness go because of how undervalued our property taxes were. Now they have reaccessed everyone's property taxes to their proper values. I know mine have tripled and have talked to some people who have had them quintuple. I have no problem with this, I know that we should be paying a proper percentage of our property's worth.

Philadelphia's city and school budgets are in dire straits. If the city had kept up with reassessments in the first place, perhaps this quintupling of property taxes would have been gradual and not sudden. It's certainly not the residents' fault, not at all, but the city needs money and this is one way to get it because the city cannot (from what I understand, correct me if I'm wrong) increase the wage tax.

What I do have a problem with is this city wage tax hitting us as well. The city wage tax is supposed to be a tax on people who work in the city and use its amenities and don't pay taxes into it, right?

The wage tax is levied on everyone who lives and/or works in the city. That's pretty much the way it's done in most places that have income taxes. If you lived in Philly and worked elsewhere, you'd be paying taxes to that "elsewhere" while still paying property taxes in Philly. I live outside of the city, pay city wage tax through my employer, and pay property taxes to my home city. This is pretty much the way the taxing world works.

The wage tax is supposed to be diminishing in percentage gradually over the next few years, is it not?

Residents are getting hit at both ends now. We pay the city wage and full property taxes now. This is not right, it's just wrong.

Every property owner gets "hit at both ends", no matter where they live or work. You're not being persecuted just because you live in Philadelphia.

[kjmc]

if you live in philly you can get that back for anytime you travel out of town for business. Dig up your travel itineraries prior to tax time.

[Charlie Cheesesteak]

Originally Posted by stylistvg

Isnt the wage tax supposed to be phased out now?

lol... that will never happen

[pman]

Originally Posted by rotodome

I don't think a wage tax is exactly the same thing as a commuter tax; but it's true that a lot more people in the city would have complained about it a whole lot more if it weren't for the unnaturally low property taxes. I think it's been pretty much acknowledged as a terrible system, which is why politicians have been trying to phase out the wage tax for the last few decades.

They can't drop it too quickly unless and until there's something to take it's place (ie: a sane property tax structure), so this is the awkward/painful transition period.

the wage tax is BY FAR the largest revenue item so in order to shift to property tax you'd have to have value crushing real estate taxes (nearly a third of the city's property is tax exempt calling into question the wisdom of taxing property to begin with). not everyone saw their bills go up, it was just people in neighborhoods where values have gone up at lot. more to the point, the city had been keeping up on assessments of commercial customers so the city was overtaking commercial customers (overtax business, I know, hard to believe right?). the reality is that the tax burden is high because the tax base is too small (or perhaps the tax base is too small because the tax burden is too high since Philadelphia had a good tax base and lost it). worse, the city does a terrible job of collecting taxes so it raises rates on those who do pay.

[sj08054]

The city wage tax is supposed to be a tax on people who work in the city and use its amenities and don't pay taxes into it, right?

Hate to tell you this but they are in a way. There is a business tax that Philadelphia imposed on doing business in Philadelphia. People working in the city but living outside are paying their fair share to contribute already. How Philadelphia manages and use those tax dollars is a different story.

[mancat100]

Originally Posted by pman

worse, the city does a terrible job of collecting taxes so it raises rates on those who do pay.

And THIS is an outrage. Reassessment or not, no one's taxes should have been raised until the deadbeats were taken care of.