What Philly's wage tax cut means for your wallet
Philadelphia officials approved cuts to the city's wage tax along with the new city budget last week, but workers won't likely see a big boost in their paychecks.
What to expect: Philly households making the city's median income, which is below $50,000 a year, will see less than $30 added to their take-home pay annually due to the small wage tax cuts, according to the city.
- A household earning $50,000 would save nearly $25 in wage taxes compared to the old rate, while residents earning $100,000 would pocket $49.80 in savings.
Context: City legislators and Mayor Jim Kenney hashed out a budget deal that led to last week's passage of the $5.8 billion budget for the upcoming fiscal year, which begins July 1.
- In addition to the wage tax relief, officials also slightly reduced the business income and receipts tax, or BIRT, to its lowest level in more than five decades.
Of note: The wage tax is the largest revenue generator in the city.
Between the lines: How much the business-friendly and wage tax cuts will cost Philly remains unknown.
- The city has yet to calculate how much the tax cuts will cost the city in revenue, Kevin Lessard, a spokesperson for the Kenney administration, told Axios last week.
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