Many Philadelphia business owners are facing new city taxes this year, and some say the additional costs are hitting sole proprietors and single-person operations especially hard. Smaller enterprises may be paying, for the first time, the city’s business income and receipts tax (BIRT) after an exemption was eliminated last year following a lawsuit. Under the exemption, businesses did not have to pay taxes on their first $100,000 of revenue. All for-profit commercial, limited liability, corporations, partnerships and individual owners doing business in Philadelphia must pay BIRT, which is a 5.71% tax on net income and a 1.41 mill rate, or $1.40 per $1,000, on gross receipts. City leaders are encouraging people to seek help from a new program that matches vetted accounting firms with small businesses as they navigate the changing tax codes. The Philadelphia Free Business Tax Preparation Program will also help businesses file their state and federal taxes.
Source: WHYY; 2/4/2026