Easttown's look at EIT provides informative case study

Easttown Township supervisors recently commissioned a revenue study on the potential impact of a local earned income tax (EIT).

After reviewing the data and hearing from residents, supervisors voted 3-2 to abandon plans for an EIT in 2024. But the township's process provided some interesting information as a case study.

Page 4 of the June 14 supervisors meeting agenda has a flowchart showing how an EIT would affect Easttown residents differently depending on where they work.

The revenue study (beginning on agenda Page 15) shows that Easttown residents paid more than $2.5 million in EIT to other municipalities in 2022. The study ranks the top employment locations for township residents — with the greatest number of residents (16.6%) working in Philadelphia, and just 3.9% working in Easttown.

The study also examined other legally permitted local taxes — like per capita tax, business privilege tax, local services tax and amusement tax — and how they might affect the township budget if implemented.

Image: Screenshot of Easttown Twp EIT revenue study