Philly Council president: Firms doing business with the city must have U.S. headquarters

Philadelphia City Council may ban companies that have moved their home offices out of the country from doing business with the city. 

Council President Darrell Clarke said he doesn’t want the city to contract with companies that avoid taxes by moving their home offices beyond the U.S. borders. 

A bid on a Philadelphia Housing Authority contract from an energy company that is not located in the U.S. alerted Clarke to the matter.

“It’s estimated they will not be paying approximately $150 million in taxes to the U.S. government,” he said. “And that’s a problem.”

Any company doing business with a governmental agency should be paying taxes, he said.

“We just don’t think it’s fair they’ve taken advantage of a loophole in the system,” said Clarke, who has introduced legislation to safeguard against the practice known as inversion. “While we can’t obviously affect the national level, it’s clear that we have the power within the municipality to not contract with companies that use that practice.”

A hearing on the issue is planned.