Additional Tax Relief Announced for Philadelphia Businesses

During Mayor Kenney’s daily COVID-19 press conference on Dec. 1st, details of three new business tax relief changes by the Philadelphia Department of Revenue were announced. The changes are aimed at providing Philadelphia businesses with additional relief during the current pandemic.

Mayor Kenney stated “I recognize that none of these changes will be enough to fully overcome the impact of an economic downturn that has hit certain sectors—including restaurants—tremendously, but rest assured that within the constraints of the City’s own budget challenges, we are looking for new ways to provide relief. At the same time, we have been advocating endlessly for additional funding from the state and federal governments to provide you with more support, and we’ll continue to do so.”

The three changes include:

• Amending U&O guidance to exempt the portion of restaurants and bars used for indoor dining from Use & Occupancy Tax: This initiative will exempt restaurants and bars from Use & Occupancy tax on the square footage of the business used for indoor dining (dining room space) during the period when indoor dining is prohibited. This exemption is for this most recent “Safer at Home” phase and would be effective from November 20, 2020 through January 1, 2021.

• Businesses can amend BIRT returns and receive a refund: Under this initiative, the Revenue Department will provide guidance and instructions to businesses that if they feel they overestimated their 2020 BIRT estimated payment, they can amend the return and provide a new, more realistic, estimated payment and have the difference refunded. It would take six to eight weeks for businesses to receive refunds. 

• Extending Refuse Fee due dates: Under this measure, the full $500 refuse fee is now due by June 30, 2021. Previously, half of the annual fee was due December 31, 2020. 

Questions?

Should you have questions about any of the new program announced by City officials or any other topics, please contact us at any time.

Additional References:

City of Philadelphia Use & Occupancy Tax Guidance

City of Philadelphia Business Income and Receipts Tax (BIRT)

City of Philadelphia Annual Refuse Fee

Philadelphia Business Resource Finder

Wouch Maloney COVID-19 Resources for Businesses and Individuals

DISCLAIMER: The WM Daily Update COVID-19, COVID-19 Business Resources and COVID-19 Client News Alerts and other related communications are intended to provide general information on legislative COVID-19 relief measures as of the date of this communication and may reference information from reputable sources. Although our firm has made every reasonable effort to ensure that the information provided is accurate, we make no warranties, expressed or implied, on the information provided. As legislative efforts are still ongoing, we expect that there may be additional guidance and clarification from regulators that may modify some of the provisions in this communication. Some of those modifications may be significant. As such, be aware that this is not a comprehensive analysis of the subject matter covered and is not intended to provide specific recommendations to you or your business with respect to the matters addressed.