Philadelphia’s decades-old tax abatement program is about to undergo some serious changes. Philadelphia city council approved cutting the tax break for home construction, reducing abatement 10% for ten years.
Two decades since the program started, Philadelphia City Council unanimously voted Thursday to change a controversial tax abatement for new builds within city limits.
The approved changes will reduce tax breaks for new residential construction by 10 percentage points every year for 10 years. The changes go into effect Dec. 1 2020.
City council introduced the legislation last month and Mayor Jim Kenney is expected to sign it into law, the Philadelphia Inquirer reported.
“Is a 10-year, 100% tax abatement still needed in the City of Philadelphia?” City Council President Darrell L. Clarke, who represents the 5th District, asked in September. “I would say absolutely not.”
Last year, city council took up the tax break but fell short of changing the program despite vehement calls to do so.
Developers worried that reducing the tax abatement would hurt Philadelphia, while others said it accelerated gentrification and unnecessarily burdened longtime residents.
"In the past five years it’s been a gold mine for the city, which is why I got licensed in Philly to begin with," realtor Tiffany Beltran previously told NBC10.
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But City Councilwoman Helen Gym, a longtime opponent of the abatement, said Thursday's vote will sure a brighter future for more people.
"We make sure of two things: first, that new development helps fund our schools, and second, no one gets a free ride on their property taxes for 10 years," she said in a statement.
