The Bulletin
February 11, 2009
By Jenny DeHuff
Mayor Michael A. Nutter signed an executive order establishing a new Mayor’s Task Force on Tax Policy and Economic Competitiveness, following his address to more than 1,600 business community leaders yesterday.

During his annual luncheon with members of the Greater Philadelphia Chamber of Commerce, Mr. Nutter said the city is lacking its ability to compete with other major cities, and needs immediate action to review a major overhaul of its tax system.

“We will not be held hostage by traditional or outdated ways of thinking about government — mindsets for another time, and another set of challenges,” he said in a speech.

“We’re going to have to consider budgets scenarios that may have been unthinkable even just a year ago, as we seek to preserve our core services and protect the most vulnerable in our society.”

Mr. Nutter said the new, 15-member group will be charged with putting together a plan outlining what steps are needed to completely modernize the city’s tax structure.

But some businesspeople expressed concern over commissions and task forces that issue recommendations, only to have them fall on deaf ears.

During the John F. Street administration in 2002, the mayor was criticized for creating the Tax Reform Commission, which put forth recommendations with regard to wage tax reductions. Many of those proposals were either not adopted or still remain stalled in bureaucratic red tape.

“The tax reform commission did a good job at that time,” Mr. Nutter told reporters. “But I think we need a much broader and deeper look at the entire tax structure of the City of Philadelphia. The tax reform commission was not asked to do that.”

Brett Mandel, recent executive director of Philadelphia Forward, the government watchdog group, said the executive order seemed like a lot of smoke and mirrors.

“The time for studying these problems has long been over,” he said. “The tax reform commission, five years ago, came up with recommendations that still have not been implemented. There’s no mystery here.”

But the mayor said he is willing to accept the counsel of his task force advisors, including advice he gets about the overall structure of the city government.

“I’m very sensitive to the same concerns that businesspeople raise and I’ve been a leading tax reduction person in the city for a long period of time,” he said. “But I think we can’t be afraid to look at — what any business owner would tell you — is probably one of the most onerous tax structures anywhere in the United States of America. We can’t be afraid to take a look at it and look for ways on how to improve it.”

Mr. Nutter said the task force, which is in the process of being assembled, would not affect the upcoming Fiscal Year 2010 budget. He said he expects a full report from the assembly by mid-September of next year.