One of the ideas for closing the budget gap that is floating around the local blogosphere has been removing a certain business privilege tax exemption from banks and other companies that are subject to heavy government regulation.  In trying to figure out why it’s there in the first place, I made a call (and Chris sent an email to the city) and so far, I’ve discovered that the reason for the exemption is somewhere along the lines of: the profits of these entities are already restricted by such and such state and federal regulations that subjecting them to the BPT would be a further erosion of their ability to operate.  The less “official” reason, according to at least a couple folks, is that they must have pretty good lobbyists.

It’s important to note, however, that for the purposes of balancing the City of Philadelphia’s FY 2010 budget, getting new revenue by removing this exemption such that banks and utilities have to pay the BPT requires a change in state policy.  This wouldn’t happen in time for this budget but could be a value expressed by the people of Philadelphia so that the mayor and council work towards getting the state to make this change.  So this was left off as a choice for closing this year’s budget gap but it’s definitely fair game for the gaps that are sure to arise in the next fiscal year when, according to the budget office, things get really bad before they pick up.

So I’d say: if this is one of your suggestions, keep bringing it up!  Keep getting it into the moderator reports for the event.  Keep posting it as comments on this blog or the Penn Center for Civic Engagement website.  Put it on the wailing wall.  Say it in the two minute video testimonials.  Do what you can to make sure that through this process, your voice is heard.

For our part, we’ll continue to look for answers and look into things that folks bring up here.

(By the way… anyone who knows of a less political, perhaps more “economic” rationale for exempting banks and utilities from the BPT can feel free to offer it in the comments or email me.)