A proposed Fair Share Tax in Pittsburgh could raise $51 million annually by taxing unearned income, with most of the revenue coming from the city’s wealthiest residents, according to a new report.
PITTSBURGH —
Pittsburgh City Council member Barb Warwick has introduced a proposed Fair Share Tax that could generate $51 million annually by imposing a 2% tax on unearned income, according to a report from the Keystone Research Center, a nonpartisan economic policy think tank.
The tax would apply to income from capital gains, rents, royalties, patents, trusts and other sources that are currently taxed by the state but not by the city. Retirement income, including pensions, Social Security and 401(k) plans, would be exempt under the proposal.
“I welcome a robust dialogue about how are we going to fund the future of Pittsburgh,” Warwick said. “Is it going to be by cutting and cutting and cutting resources to our most vulnerable residents, or is it going to be by ensuring that our wealthiest residents step up and help out and pay their fair share so that we can continue to grow and make Pittsburgh the beautiful city that it is?”
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The Keystone Research Center estimates that the tax would primarily affect individuals with an average annual income of $274,000, with about half of the revenue coming from the top 1% of Pittsburgh’s wealthiest residents. The report highlights that Pittsburgh’s current tax system relies heavily on wages and business profits, placing a larger burden on low- and middle-income residents while wealthier individuals pay a smaller share of their income.
“What you end up seeing is working-class Pittsburghers, middle-class Pittsburghers — nurses, mechanics, EMT workers, security guards, that type of thing — are actually paying 75% more as a percentage of their total income than residents who are earning millions of dollars a year. That’s fundamentally unfair,” Warwick said.
Warwick’s proposal comes after Mayor Corey O’Connor presented his 2027 preliminary budget, which avoids a tax increase. The legislation aims to address inequities in the city’s tax system while providing additional revenue to support Pittsburgh’s growth and services.
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