Ah, Philadelphia — the “City of Brotherly Love.” Philadelphia — “the place that loves you back.”
Philadelphia — the city that has a wage tax of 4.53 percent for its residents — a wage tax that has helped decrease the population and drive away businesses.
This tax cuts into nobody’s pocket more than the lowly college student. We may not make very much at our part-time (or full-time) jobs, but the City makes darn sure that it gets 4.53 percent.
Now, while this figure may seem extremely small for those who are out of school and have a decent full-time job, for the college student this results in at least one less meal per week. That is, if you make $100 in a week, the City takes an extra $4.53 — that’s an entire case of ramen!
In a year (assuming you make $100 per week) the City grabs over $230. That’s enough money to cover the cost of books in a semester.
That $230 could be your share of the rent for one month.
The city started cutting the wage tax incrementally back in 1995. But now, as an economy on the rebound has eaten into tax revenue, Mayor John Street is calling for an end to these cuts. Philadelphia businesses and organizations responded by calling for a larger decrease in the wage tax.
Street claims a cut now will hurt the City by leaving little room for the City to operate. The wage tax is city hall’s biggest moneymaker (about $1 billion every year) and pays for about 34 percent of the City’s budget.
However, Philadelphia businesses say it will help the City later by creating jobs and actually increasing tax revenue. According to an article in the Philadelphia Inquirer , cutting the wage tax to 3 percent could mean not only a rise in property value, but also 164,000 new jobs.
Year after year, tens of thousands of students attend Philadelphia universities only to leave upon graduation to find work in other cities. Maybe it is time for the City to consider the ramifications of constantly watching young professionals leave the City limits.
An aging work force, without an influx of new talent and new ideas, would spell disaster for the City. Dropping the wage tax would certainly be a step in the right direction toward winning over those graduates, thereby giving the City an injection of energy and fresh ideas that any thriving metropolis needs to continuously grow and improve.
But what exactly does all of this mean to a Temple student?
It means that basically a cut in the wage tax will not only boost your wallet now, but also offer incentive for more businesses to come to Philadelphia. More businesses mean more jobs — a fact that will be extremely important to you in the future — and more jobs would mean more tax revenue the City could collect. With the new jobs in the City, perhaps an increase in cigarette and alcohol tax, and just a little bit of hard work, Philadelphia could pull the tax cut off.