Scabby the Rat, step aside: There’s a new float grabbing eyes at rallies for left-leaning causes in Philly. Namely, the quintessential “fat cat,” Mr. Riggs — a well-tailored tabby making appearances as part of the ongoing campaign to introduce a wealth tax in Philadelphia.
What Scabby and other inflatables are to labor relations, Mr. Riggs is to the city’s tax policy, sending an unsubtle message from a coalition of organizations advocating for higher levies on the richest Philadelphians.
“I think Mr. Riggs makes the point we’re trying to make,” Marc Stier, director of the Pennsylvania Budget and Policy Center, told Billy Penn. “The economy really is rigged to benefit wealthy multinational corporations and the ultra rich in our country, the top one percent.”
The specific bill being boosted by the Tax the Rich PHL coalition is Councilmember Kendra Brooks’ so-called wealth tax, which she’s been pushing a version of since 2020. Composed of a host of local organizations advocating for workers and progressive policy, the coalition is one node in a nationwide network.
Mr. Riggs is newer to the Philly scene. The float arrived last month on loan from Unrig Our Economy, a national umbrella organization joining campaigns in favor of wealth taxes and increasing healthcare affordability. As far as Stier knows, this is his first showing in Philly.
“I think we’re going to be keeping Mr. Riggs around for a little while, because we’re going to be doing more actions and events along these lines,” Stier said.
Given the influx of new faces on Council, a mayoral campaign, and the fact that the latest budget season ended in tax cuts at the behest of an increasingly organized group of local chambers of commerce, the bougie float balloon may be in for an extended stay.
‘We could heal years of disinvestment’
Mr. Riggs made his debut at a City Hall Rally for the wealth tax in late September.
The meeting of local organizers, educators, labor officials, and elected officials was dubbed the Tax the Rich People’s Hearing, since the actual hearing on Brooks’ bill was canceled by Council President Darrell Clarke, due to the resignations of four former council members with mayoral ambitions.
Instead, testimony that would’ve been offered within City Hall was read outside of it.
Brooks told the small crowd that the tax “would raise over $200 million in annual revenue that we could invest back into City Services.”
The bill she is proposing would revive an old statewide tax on “intangible personal property” — defined as direct holdings in stocks and bonds, as well as mutual funds and ETFs — at a rate of 0.4%, excluding tax qualified retirement accounts like a 401(k) or IRA.
The tax would apply to all residents, but supporters say it would mostly affect the wealthiest, who are much more likely to directly own stocks or bonds.
When reintroduced this spring, critics said the tax would convince wealthier Philadelphians to leave town for greener pastures, and noted that many investments utilized by middle class people were within the scope of the policy.
If the planned Council hearing had actually taken place, the at-large councilmember would have amended her bill to respond to the latter issue, her office said, to exclude more forms of investment from the “intangible personal property” in question.
“Councilmember Brooks is interested in introducing an amendment that would exempt 529 savings accounts and potentially other assets that are overwhelmingly held by working class and middle class people,” Maggie Hart, a spokesperson for the councilmember, told Billy Penn.
Those 529 plans are state-sponsored savings plans that encourage saving or investing to help pay university tuition fees. A 2012 government study noted that the plans aren’t widely utilized, and tend to be used by middle class families.
Paying off a food truck or cart is another form of investment that urban entrepreneurs take on, and serves as an example of the changes being considered as Brooks works on the policy.
“We’ve been consulting with them,” Stier of the Pennsylvania Budget and Policy Center said, of Brooks’ team. He went on to say, “I don’t think any of us are stuck on one way of making our taxes fair.”
Another method Stier proposes is a tax on unearned income or income from wealth. “Except for the schools tax, unearned income, capital gains, dividends, things like that, they are not taxed at all by the city — and they could be.”
Federal taxes already exist for such unearned income, which coalitions like “Tax the Rich PHL” believe could be stronger, in light of the income of wealthy households that escapes taxation.
Of course, an inevitable question is raised when these and other wealth-taxing measures are brought down to the municipal level: Won’t rich people just skip town?
Brooks and the tax’s supporters have constantly referred to the “myth of the moving millionaire,” in response to such questions, pointing to prior examples that raising taxes alone does not persuade rich people to pack up and move.
Hart, Brooks’ spokesperson, noted that with Mark Squilla recently appointed as the new head of the Committee on Finance, “City Council may begin scheduling and rescheduling Committee hearings in the near future,” to further hash out the merits of a wealth tax.
The odds of Mr. Riggs making it inside City Hall when that day comes is slim, but don’t be surprised if you catch him camped outside again.