{"id":188297,"date":"2026-05-09T22:45:35","date_gmt":"2026-05-09T22:45:35","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-pa\/188297\/"},"modified":"2026-05-09T22:45:35","modified_gmt":"2026-05-09T22:45:35","slug":"philly-small-businesses-protest-birt-tax-hike","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-pa\/188297\/","title":{"rendered":"Philly small businesses protest BIRT tax hike"},"content":{"rendered":"

Love Philly? So do we. Let\u2019s be friends. Sign up for the Billy Penn newsletter today<\/a>.<\/p>\n

A big tax increase for tens of thousands of Philly\u2019s smallest businesses is causing consternation and drawing urgent calls for a fix.<\/p>\n

Jeanine Stewart, a therapist in Center City, said the city tax bill she paid last month soared $8,000 or 60% compared to last year, largely because of a huge jump in her Business Income and Receipts Tax (BIRT) bill.<\/p>\n

\u201cIt is absolutely crushing and absurd,\u201d she told City Council during a budget hearing Wednesday. \u201cAs a result, I\u2019m looking at moving my practice outside of Philly, and I have a tour of an office in the suburbs scheduled for today. So are many therapists across the city.\u201d<\/p>\n

Last year, the Parker administration ended an exemption for the first $100,000 of earnings<\/a> from the BIRT after a court challenge. About 75,000 small businesses, independent contractors and gig workers suddenly had to come up with money to pay much higher tax bills, the city estimates.<\/p>\n

The tax hike was a hot topic among members of the public who testified at the hearing, as was a proposed $1-per-trip rideshare tax<\/a> and other new levies<\/a> Mayor Cherelle Parker is asking council to approve before the end of June.<\/p>\n

Without a change, the BIRT will have \u201cchilling effects\u201d on solo practitioners in Philadelphia, clinical psychologist Karen Eselson Belding said. She said her BIRT tax skyrocketed from $1,213 to $14,774.<\/p>\n

\u201cThe young professionals I counsel, many of them are simply going to move their businesses outside of the city, rather than continue to pay these taxes,\u201d she told councilmembers. \u201cOlder professionals like me will close our businesses early.\u201d<\/p>\n

Could a revised BIRT exemption pass muster?<\/p>\n

Speakers urged councilmembers to pass a bill sponsored by Councilmember Mike Driscoll that would establish new BIRT exemptions<\/a> for sole proprietors and single-member limited liability companies.\u00a0<\/p>\n

Driscoll has said his bill was reviewed by the city\u2019s Law Department and he believes it will comply with state law.\u00a0<\/p>\n

However, the new exemptions could run afoul of the state\u2019s Uniformity Clause, as the old BIRT exemption did, and face another legal challenge. The clause says a tax must be applied at the same rate on everyone who pays it.\u00a0<\/p>\n

It\u2019s also unclear whether council will vote on Driscoll\u2019s legislation, which supporters call the LIFT bill<\/a>.\u00a0<\/p>\n

\u201cAll I\u2019m asking for is that we can get a hearing,\u201d said business consultant Jigar Mehta<\/a>, a leading advocate for the bill. \u201cWe just want to talk about it, and if from there, God willing, with God\u2019s grace, we will be able to move forward, maybe they\u2019ll vote and we\u2019ll give some relief to these folks.\u201d<\/p>\n

\u201cWe\u2019ll make sure you get a hearing,\u201d Councilmember Isaiah Thomas said.<\/p>\n

Mehta said low-paid workers who have side jobs are being hit hard by the lost exemption, as are those who lose their full-time positions and become independent contractors.<\/p>\n

\u201cThese independent workers, they don\u2019t have access to unions. They don\u2019t have a voice out there. I can tell you from personal experience, it\u2019s been very difficult to get people organized,\u201d he said. \u201cIf you want to talk about diversity, this is the most diverse group of Philadelphians you can find.\u201d<\/p>\n

A pile of narrow business tax hikes<\/p>\n

Parker has proposed a nearly $7 billion city budget for the 2027 fiscal year that starts July 1. It does not include increases in property tax rates or broad-based business levies, other than the revised BIRT. But it does depend on a number of new, narrowly tailored business taxes.<\/p>\n

Online retailers like Amazon and Walmart would pay a new retail delivery tax<\/a> of 25 cents per delivery, excluding orders that are solely food, baby products, medicine or medical devices. If approved by City Council, it would raise $15 million to patch potholes and speed up road repaving.\u00a0<\/p>\n

The city would simultaneously expand the sales and use tax to cover residents\u2019 purchases from online businesses based outside the city. That would raise $1.5 million annually.<\/p>\n

Two of the mayor\u2019s tax changes would go toward helping the financially strapped school district. The $1-per-ride tax on Uber and Lyft<\/a> would raise $48 million, and a higher tax on cell phone towers would bring in another $2.4 million.<\/p>\n

Uber and Lyft have been advertising and lobbying against the rideshare tax. They argue it would disproportionately affect working-class residents, while the administration cites census data showing that lower-income people make relatively light use of rideshare, and says the companies can absorb the tax.<\/p>\n

Several councilmembers have said they won\u2019t vote for the tax in light of the district\u2019s unrelated move to close 17 schools<\/a>, including Robeson and Lankenau<\/a> high schools.<\/p>\n

Regressive, or a tax on \u201crecord profits\u201d?<\/p>\n

Activists and residents offered widely varying opinions of the rideshare tax Wednesday. Some rued yet another increased cost for living in Philadelphia, while others praised the effort to prevent cuts to educational programs.\u00a0<\/p>\n

Combined with the BIRT increase, the rideshare tax leaves families feeling \u201csqueezed,\u201d said Nada Mays, a dietitian who owns her own business. \u201cI don\u2019t think that the Uber and Lyft companies are going to absorb the fees, unfortunately. I do think it\u2019s going to come down to the drivers. I do think it\u2019s going to come down to us as patrons.\u201d<\/p>\n

\u201cInstead of taxing wealth, we are being asked to support a regressive Uber tax that working families will feel immediately, even though it does nothing to solve the structural deficit of our schools,\u201d said Madison Nardy, executive director of 215 People Alliance, an economic justice advocacy group.<\/p>\n

Supporters included caterer David Simms, who said residents should get behind Parker\u2019s effort to bolster public education. \u201cThe tax is needed to help save the jobs of our school district personnel,\u201d he said. \u201cI would rather tax the large companies that are raking in record profits than have the residents of Philadelphia get a property tax increase.\u201d<\/p>\n

Bicycling advocate Stan Horwitz also praised the per-ride charge, saying it would reduce use of Uber and Lyft. \u201cMore Philadelphians will travel via bicycle, thus making safe streets an even higher priority,\u201d and increasing support for more funding of the city\u2019s Vision Zero traffic safety program, he said.<\/p>\n

Parker has also proposed a 2% increase in the hotel tax, which the administration said would bring in $20 million a year to expand homeless shelters and services.\u00a0<\/p>\n

Max Ray-Riek, an organizer with National Union of the Homeless, voiced support for the tax, while urging the Office of Homeless Services not to use the new revenue to run inhospitable shelters.\u00a0<\/p>\n

\u201cWe are encouraging council to approve the hotel tax and expanded budget for OHS on the condition that OHS invest in permanent housing, not expanding the shelter system,\u201d he said. \u201cCongregate housing is more dangerous, with most shelter residents reporting they fear for their safety due to conflicts between residents, mistreatment by staff, theft and unsafe physical conditions.\u201d<\/p>\n

The tax is vigorously opposed by the city\u2019s tourism organizations<\/a>, which sent a letter to councilmembers Tuesday urging them to vote it down. The proposal \u201cwill make Philadelphia less competitive\u201d as it works to bring conventions and conferences to the city, they wrote.<\/p>\n","protected":false},"excerpt":{"rendered":"Love Philly? So do we. Let\u2019s be friends. Sign up for the Billy Penn newsletter today. A big…\n","protected":false},"author":2,"featured_media":188298,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[83968,60,9537,990,20212,80561,69,71,70,50,20205,2918,5800,20211],"class_list":["post-188297","post","type-post","status-publish","format-standard","has-post-thumbnail","category-philadelphia","tag-birt","tag-business","tag-cherelle-parker","tag-city-council","tag-lyft","tag-mike-driscoll","tag-philadelphia","tag-philadelphia-headlines","tag-philadelphia-news","tag-politics","tag-rideshare","tag-small-business","tag-taxes","tag-uber"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/posts\/188297","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/comments?post=188297"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/posts\/188297\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/media\/188298"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/media?parent=188297"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/categories?post=188297"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-pa\/wp-json\/wp\/v2\/tags?post=188297"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}