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Philly’s contested wealth tax push, explained

Plus, your guide to Pa.’s lieutenant governor race.


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April 4, 2022
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A new wealth tax push in Philadelphia, the nation's poorest big city, is drawing support from the likes of U.S. Sen. Elizabeth Warren (D., Mass.) as officials, including those at the federal level, grapple with how to approach more aggressive taxation of the wealthy, or whether to approach it at all.

City Councilmember Kendra Brooks is reintroducing her longshot "Philly Wealth Tax" bill with support from progressive colleagues and Warren, who calls it a necessary check on America's "broken" and "rigged" tax system.

The measure has inspired no shortage of pro and con arguments. 

Broadly speaking, supporters say the plan would raise hundreds of millions of dollars annually and help address economic inequality that has only worsened during the pandemic. Critics warn of an exodus, collateral impacts, and a share of the tax burden being placed on the middle class.

THE CONTEXT: The Philly tax would apply to "intangible wealth," mainly stocks and bonds, that wealthy people are the likeliest to have.

According to a copy of the bill, the tax would total 0.4% of their value, or $4 for every $1,000 of holdings. Retirement accounts and mutual funds would be exempt, but not 529 savings plans or privately owned businesses.

Federal Reserve data from 2021 shows the wealthiest 10% of Americans hold almost 90% of the stocks on the market. The Keystone Research Center and Pennsylvania Budget & Policy Center estimate the top 5% of Philadelphia families by income would account for 70% of revenues raised.

But the Philly Wealth Tax would have to apply to all city residents under the state's uniformity clause, which requires taxes to be levied equally.

Three of 16 council members have come out in favor of Brooks' bill, while advocacy groups have fallen on both sides of the issue, per The Inquirer. The paper notes no major U.S. metro area has a wealth tax currently but says "many Pennsylvania cities and towns, including Philadelphia, had local levies on financial holdings known as personal property taxes until the 1990s, when wealthy individuals and financial institutions revolted."

The Philly debate is a microcosm of a larger one playing out at the national level, with President Joe Biden's 2023 budget including a 20% minimum tax on all income for Americans with more than $100 million in assets.

"While Judge Jackson undoubtedly has an impressive educational and professional background, her inability to define her own judicial philosophy makes it difficult to understand how she might approach the most important cases facing the nation today, tomorrow, and far into the future."

U.S. Sen. Pat Toomey (R., Pa.) saying he'll vote no on Judge Ketanji Brown Jackson for the U.S. Supreme Court; U.S. Sen. Bob Casey (D., Pa.) is a yes
The "Commonwealth" statue atop the Pennsylvania Capitol, courtesy of @yatsko. The statue is meant to be a "symbolic embodiment of the Commonwealth of Pennsylvania." Send us your Pennsylvania gems, use #PAGems on Instagram, or tag us @spotlightpennsylvania.
SECOND-IN-COMMAND: There is another crowded primary contest unfolding in Pennsylvania with relatively little fanfare: that of lieutenant governor. There are 12 people running to become Pennsylvania's second-in-command — two more than in the governor's race. Spotlight PA has a guide to the candidates for the post, one with largely symbolic value but key procedural and criminal justice roles.

ROLE REVERSAL: Early on in the pandemic, with lockdowns sweeping the nation, state Sen. Doug Mastriano (R., Franklin) proposed a rollback of medical privacy protections for COVID-19 patients, a position very much at odds with the personal-freedom-warrior persona he's cultivated ever since, the Capital-Star reports. His opponents in the current Republican race for governor are eagerly weighing in.

LEGAL ENTRY: The U.S. Department of Justice wants to join a lawsuit against Schuylkill County and Commissioner George Halcovage Jr. filed by four county employees accusing him of sexual misconduct. The DOJ says elected officials who abuse their power must be held accountable. Halcovage denies any wrongdoing and has resisted calls to resign. State lawmakers are weighing a rare impeachment.

ON-DUTY DEATH: A Lebanon police officer was shot and killed on Thursday one month from his planned retirement. Lt. William Lebo was killed responding to a domestic incident call. Two other officers were critically wounded in the shooting. Per the Lebanon Daily News, the shooter, identified as 34-year-old Travis Shaud, was killed by police. A news release cited a history of violence and mental illness.

DEM DEBATE: Leading Democratic candidates for U.S. senator from Pennsylvania gathered for a debate at Muhlenberg College on Sunday with one notable exception: Lt. Gov. John Fetterman, the race's frontrunner. Opponent and U.S. Rep. Conor Lamb (D., Pa.) seized on Fetterman's absence as an attempt to avoid criticism for a 2013 incident involving Fetterman, a gun, and an unarmed Black man.
HOLY MONTH: Ramadan, the holy month of fasting observed by more than a billion Muslims worldwide, has begun, and Food & Wine says an iftar meal at a Mexican restaurant in Philly has become a community staple there. In Gettysburg, Religion News Service reports on a Protestant church that's helping Afghan refugees resettle and celebrate their first Ramadan in a new land. "They've been through a lot," Rev. Irene Hassan told the outlet.

UNION DRIVE: Amazon warehouse employees in New York have voted to form the retail giant's first U.S. union, marking a significant labor milestone. Four-hundred miles away in Stuarts Draft, Va., workers at Pennsylvania-based Hershey's second-largest U.S. plant voted against unionizing amid a union-busting campaign. Among the many issues there: The company rewarded workers for record-breaking production with T-shirts, not higher pay.  

OPEN BOOKS: Franklin Regional School District officials have "unpaused" teachings of the graphic novel Persepolis about the Iranian Revolution after taking time to read the book, per TribLIVE. The pause followed parental complaints about the book's content as titles like it remain culture war targets. It's not just schools either: At a library in nearby Sharpsburg, police are probing possible book tampering as an attempt at censorship.

SONG HISTORY: Pennsylvania's newest historical marker went up in Lyndell last week and belongs to musician Jim Croce, a graduate of Upper Darby High School and Villanova and singer of "Time in a Bottle," "Bad Bad Leroy Brown," "Operator," and more, The Mercury reports. Croce penned some of his most popular songs in a nearby farmhouse, the marker reads, before his death in a plane crash just as his star really began to rise.

FUNDRAISERS: A group of Philly students found their history teacher's shoes so distasteful they started a GoFundMe to raise money for new ones. As of Sunday, they'd raised more than $3,000 of a $200 goal. In less heartening Philly-area crowdsourcing news, the ringleader behind a lucrative scam involving a homeless vet and a fictitious $20 gas money donation has been sentenced to 27 months in federal prison, via 6ABC.
Unscramble and send your answer to We'll shout out winners here, and one each week will get some Spotlight PA swag.

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