Northeast Times

City collecting millions more from tax delinquents

According to figures recently released by City Controller Alan Butkovitz, Philly collected $502 million more in taxes in the 2014 fiscal year than it did in 2010’s.

If there is one thing that ticks Phil­adelphi­ans off, it’s taxes, and if there’s something that makes them really see red, it’s that a lot of people seem to get away with not pay­ing any.

But, ac­cord­ing to the city con­trol­ler’s of­fice, more people are pay­ing up and they’re pay­ing up more than they did just four years ago.

More than $500 mil­lion more. 

Ac­cord­ing to the city’s rev­en­ue com­mis­sion­er, Philly’s been clamp­ing down on the people who don’t pay and, in some cases, play­ing rough.

Busi­ness own­ers who don’t pay what they owe are be­ing told they will be shut down if they don’t fork over the cash.

They get warn­ings, Rev­en­ue Com­mis­sion­er Clar­ena Tolson said. An own­er who owes is told the busi­ness’s com­mer­cial activ­ity li­cense will be re­voked if he doesn’t fork over the cash. Since a busi­ness may not leg­ally op­er­ate without a li­cense, los­ing it pretty much means com­mer­cial death.

If an own­er ig­nores that alert, he’ll get an­oth­er no­tice in which the city says it will be there in two days to shut him down. 

“And we do,” Tolson said. 

Amaz­ingly, some of those tax dead­beats find the money they owe — with­in hours, Tolson said. Many come in with $20,000 or more. One own­er came in with a check for $40,000, Tolson said.

Tax dead­beats are gam­blers, she said. “They roll the dice and play the odds,” she said, hop­ing the city nev­er catches them. 

GOOD NUM­BERS

When it comes to city fin­ances, black ink is beau­ti­ful, and ac­cord­ing to fig­ures re­leased Ju­ly 31 by City Con­trol­ler Alan Butkovitz, Philly col­lec­ted $502 mil­lion more in taxes in the 2014 fisc­al year than it did in 2010’s.

That’s an in­crease of 22 per­cent. Tax col­lec­tion went up in al­most every ma­jor tax cat­egory, Butkovitz re­por­ted.

Here’s the con­trol­ler’s break­down:

• Real es­tate tax col­lec­tion: Up $138.1 mil­lion from $402.3 mil­lion in 2010 to $540.4 mil­lion in fisc­al 2014. That’s a 34.4 per­cent in­crease.

• Busi­ness priv­ilege taxes: Up 27.6 per­cent in 2014 over 2010, from $364.7 mil­lion to $465.3 mil­lion.

• Re­alty trans­fer taxes: Up 40.8 per­cent, from $119.2 mil­lion to $167.8 mil­lion.

• Sales taxes: Up 27.3 per­cent, from $207.1 mil­lion to $263.7 mil­lion.

• Wage and earn­ings and net profit taxes: Up 13.3 per­cent, from $1.13 bil­lion to $1.28 bil­lion.

If an own­er doesn’t pay real es­tate taxes, his or her prop­erty may be sold by the sher­iff. More prop­er­ties have been go­ing to sher­iff sale and go­ing soon­er than they used to, Tolson said. Sub­sequently, she ad­ded, col­lec­tions of de­lin­quent taxes have gone up more than 30 per­cent.

Col­lec­tions of taxes on un­earned in­come also have in­creased, the com­mis­sion­er said.

The city has had great­er en­force­ment of its wage tax, too. Since the wage tax comes out of paychecks with all the oth­er de­duc­tions, how does some­body dodge it? Well, not every­body works in the city, Tolson said. If a sub­urb­an em­ploy­er doesn’t de­duct the wage tax from a city res­id­ent’s pay, it is up to the wage earner to pay up on his or her own. So, since that doesn’t al­ways hap­pen, the city matches its files with state and fed­er­al data­bases to catch the wage tax dodgers, the com­mis­sion­er said.

“We be­lieve every­one has to pay their fair share,” she said. ••

You can reach at jloftus@bsmphilly.com.

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