Stu Bykofsky: Task force seeks to shift tax burden

Posted: August 31, 2009

IRRITATED THAT I missed the howl-and-scowl town halls - and jones-ing for some hot citizen action - I went to City Hall to peek in on something similar: the public hearing on initial recommendations made by the Mayor's Task Force on Tax Policy and Economic Competitiveness, or MTFTPEC, as the acronym-addicted would have it.

Unlike the health-scare-sessions, there were no screaming red faces, no portraits of Michael Nutter with a Hitler mustache, no AR-15s slung over shoulders.

Naturally, I was disappointed. Few things make for a better column than citizens throwing folding chairs at each other like World Wrestling Federation warriors.

Taxes, like health care, would be a blood sport, I thought. Our own Ben Franklin said: "The only things certain in life are death and taxes." (Ben's idea of a "public option" was founding America's first hospital, bless him.)

In addition to 13 attending task-force members, maybe 40 people were rattling around the ornate City Council chamber during the three hours the thing droned on. Two-thirds of them got up to comment, and almost every speaker represented a special interest - builders, unions, community organizations.

The hearing began on time, such a rarity in City Council chambers that it almost caused the walls to tremble, and ended three hours later, 30 minutes over schedule. MTFTPEC's formal report is due next month, and that's when the real squealing will start.

The task force's idea is to shift the tax burden "from taxes on things that are mobile (people and businesses) to assets that are fixed (land and buildings)." This form of civic entrapment is great news for tenants, not so great for landlords (including you, if you own your home).

The focus is not to reduce taxes (although MTFTPEC believes that that can be done by technology, cost-cutting and - ha, ha - by getting more from the state and the feds). The plan is to jigger taxes so they are not a barrier to attracting and retaining business, which provides the jobs that are the city's lifeblood. But when someone wins (businesses and wage-earners), someone else loses (property owners).

The task force acknowledges that before the city can shift the burden from wage/business taxes to real-estate taxes, we need a more efficient agency than the constantly-under-fire Board of Revision of Taxes.

But the BRT is not the only agency that trips over its own shoelaces, and is not unique in infuriating taxpayers.

Frustrated Center City businesswoman Sarah Van Aken told MTFTPEC that she had "issues with the Revenue Department," under whose wing the task force operates. "You can't get anyone on the phone, even when you want to pay," she said.

In a later conversation, she told me that it was a snap dealing with Philadelphia Industrial Development Corporation, but that "there's no easy way to work with the city if you're a small business. There's no 'one-stop shopping.' "

Getting approval for her business signage on Sansom Street took eight months.

"I had people working for the city - I won't say who they are - say, 'Just put up the signs and we'll look the other way.'

"That's so stupid," she said. "I'm trying to do things the right way."

If it takes the city eight months to approve a couple of signs, is it smart enough to reform the tax structure?

* The poor and middle class say that the tax burden shouldn't be shifted to them. They're right.

* Developers say that Philly's tax structure and union wages cause builders to avoid us like sidewalk dog poop. They're right.

* Citizens complain that tax abatements for the rich are unfair. They're right.

I know what you're thinking: They can't all be right.

* You're right, too.

But they can all be right. It's a matter of whom we want to scream when we bring the pain. The task force must do the impossible and chart a course through the competing claims, interests and needs.

As President Obama says about health care, the system we have now is not sustainable. Change must come.

Our current tax structure is self-defeating. Almost everyone agrees on that.

Who should pay more? Who should pay less? Those are the questions.

We get the answer next month. Better pay attention.

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