Millions of tax dollars from Bucks County have ended up being collected in Philadelphia due to the city’s Wage Tax. Staff reporters from Daily Magazine wrote about the taxes.

To discuss this issue, members of the Pennsylvania Senate Majority Policy Committee visited Middletown last week at the invitation of state Sen. Frank Farry.

They learned about the impacts it has on communities where local people who work in the city live.

The Philadelphia Wage Tax was established by the Sterling Act in the 1930s to help the city through the Great Depression. Nine decades later, the tax is still in place. For non-residents, it is set at 3.44 percent.

Bucks County residents who pay wage tax do not have to pay the earned income tax collected by most municipalities which is usually between 0.5 and 1 percent.

These taxes are needed by municipalities to fund extra police as well as fire and street services that are needed due to the growth of the county in the last several decades.

“This act is not fair,” said Northampton Township Manager Robert Pellegrino.

According to the Bucks County Association of Township Officials, 20,377 residents from dozens of local municipalities work in Philadelphia.

Read more about the Philadelphia Wage Tax in Daily Magazine.

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