How the taxes would work

Posted: March 04, 2010

Here are the details of Mayor Nutter's proposed trash fee and soda tax:

* The trash fee would be $5.77 a week or $300 a year for property owners and would be placed on residents' real-estate-tax bill. Some low-income households would qualify to pay a $200 fee instead. This fee would be effective July 1 and is expected to bring in $108 million annually.

* The sugary-drinks tax would be 2 cents per ounce of soda, juice and other sugary beverages. That tax would be charged to retailers, as part of their business-privilege tax. Presumably they would pass the charge on to consumers. It's estimated to yield $77 million a year, but because it wouldn't begin until next 2011, the tax would generate $39 million next fiscal year.

And what does it mean to taxpayers' bottom line?

In one fell swoop, the trash fee would eat up more than half the money that an average Philadelphia household is saving from the small, incremental wage-tax reductions that the city initiated in 1992.

The mean average income for a Philadelphia household was $50,673 annually in 2008, according to the Census Bureau. Wage taxes on that income are now 3.9296 percent, or $1,991 per year, a savings of $522 from what the same household would have paid before the wage-tax reductions began.

Nutter and City Council suspended the wage-tax reductions two years ago at the beginning of the national recession, but the reductions are scheduled to resume in the 2014 fiscal year, which starts July 1, 2013.

- Catherine Lucey and Bob Warner

comments powered by Disqus
|
|
|
|
|