Councilman Oh, back at work, speaks up against the ‘Tech Tax’

As probably everyone in Philadelphia knows by now, Councilman David Oh was stabbed last Wednesday night outside his home in Cobbs Creek.

Following exploratory surgery, Oh was back at his desk not 48 hours after. And on Friday afternoon, Oh kept his word on an interview with Technical.ly scheduled before the attack. The topic? The reinstatement of a six-percent sales tax on computer services and software found in Governor Tom Wolf’s budget proposal.

(Check section C1-15 here for the proposed update.)

Oh, who is a Republican, says he’s had no problem supporting the Democrat governor on issues like the opioid crisis, though he cedes that a tax on technology is “challenging” from a political standpoint. (“It’s an election year,” he quipped.)

Nevertheless, Oh submitted a bill to the council which will be voted on June 8. It’s titled “Opposing proposed taxes for technology and computer services in Pennsylvania.” Sure, the purpose is to voice Philly’s dislike of the tax, but it will also serve as an opportunity to hear from local technologists on the issue.

Oh says the levy, as it’s stated now, is “detrimental to the growth and competitiveness of our current economy.”

“The proposed tax would take $230 million from the tech sector to close a $3 billion deficit in the state’s FY18 budget,” Oh said. “A lot of our businesses are based in tech and we’ve had a lot of growth meetings these needs. A six-percent tax on top of all the other taxes I think would have an adverse effect.”

As we’ve heard from Oh before, he’s not a real “tech person” but is open to hearing from those who are. The Council vote on the opposing resolution would be the venue for such feedback.

But before the vote is had, here are two quick reactions to the proposal. Guru’s Rick Nucci, for example, isn’t keen on the idea.

“I think it’s a mistake,” Nucci told Technical.ly in an email. “To me it seems pretty simple: tech is now the dominant industry in our country, with 4 of the 5 biggest market caps in the US being technology companies. Soon we won’t call them Tech companies, they will just be Companies. I think Pennsylvania needs to decide where it wants to be as the next wave of future growth companies choose where to call home.”

Jake Stein, CEO of Stitch, suggests expanding the levy to all products and services:

“I’d be in favor of the same sales tax rate being applied to all products and services, including software,” Stein said. “It would certainly add logistical overhead for us to calculate and charge the fee, but I would be surprised if it has a material impact on our business. ”

Better believe we’ll be at that Council session and will bring you all of the deets.

On a different topic, Councilman Oh — who’s been heralded as a “friend of the tech community” by Cloudamize CEO Bob Moul — wanted to take a sec to thank everyone who was concerned for his well-being.

“I appreciate the outpouring of concerns and well wishes,” Oh said. “I thank the people of the tech community but I also see them as part of the solutions to the problems we have in the city, including the fact that in the city people sometimes stab each other.”