PICA: The sales tax hike is doing its job

Remember that sales tax increase Mayor Nutter fought tooth and nail for in Harrisburg? Well, it's finally impacting city revenues. December tax collections increased $6 million, or 2.3 percent, from last year, according to preliminary data released by the Pennsylvania Intergovernmental Cooperation Authority.

PICA attributes much of that increase to the tax hike. If you don't count the sales tax, December revenues declined 2.1 percent from last year.

December wasn't good enough to rescue the first half of this fiscal year. Collections for the first six months of FY 2010 were 5 percent lower than the same period in FY 2009, coming in at $793.1 million.

Nevertheless, PICA says that the wage tax base is stabilizing and that December real estate transfer tax receipts increased 41.4 percent over the same period last year.

The City's Five-Year Plan assumes that with the sales tax hike in place, total tax receipts will be 4.2 percent better this fiscal year than in fiscal 2009.*

You can read a PDF of the PICA report here.

*This line was corrected. The original line said that PICA projected this revenue improvement; in fact, the city projected it and PICA deemed the projection reasonable.

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