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Philly tax reform is dead, long live Philly tax reform

A bill to turn the city's business-tax structure on its head is dead for now, as its Council sponsors agreed Tuesday to instead work with the Nutter administration in the hope of preserving at least some of their ideas.

A critical Council committee hearing scheduled for Wednesday has been postponed indefinitely, and Mayor Nutter has scheduled an afternoon news conference instead.

In a letter to City Council members Bill Green and Maria Quiñones Sánchez Tuesday, Nutter's chief of staff, Clay Armbrister, outlined the areas of agreement that the two camps would collaborate on.

Those include finding a way to exempt the first $100,000 of a company's sales from taxes and close loopholes that allow national corporations and out-of-town companies to avoid paying city business privilege taxes even as they do business in Philadelphia.

I think Council members Bill Green and Maria Quiñones Sanchez are right to pursue an overhall of the city's business tax system. But since this effort appears to have hit a temporary dead-end, they might want to take aim at the other part of Philadelphia culture that new- and small-businesses find so discouraging: the regulatory thicket.

I think good regulations are good for a community and its businesses, protecting consumers and leveling a playing field so that conscientious merchants aren't at a disadvantage against less-scrupulous rivals. I'm not sure that's what we have in Philadelphia right now. Does anybody talk about L&I in glowing terms? I haven't heard it. But I have seen business startups delayed by months as entrepreneurs navigated the regulatory bureaucracy with often-frustrating results. Some smart council person could probably advance their career -- and do Philadelphia a lot of good -- by advancing the cause of regulatory reform in this town.

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