In an effort to determine the real impact for Falls residents should an earned income tax (EIT) be instituted, the fiscally responsible Falls Supervisors contracted with a firm to update its 2014 EIT study.
During Monday night’s meeting, the board voted unanimously to hire ESI Consult Solutions, Inc. to undertake a study, which, once complete, will offer insight on the financial impact of a 1 percent EIT on Falls Township’s budget. Supervisors Jeff Dence and Erin Mullen were absent.
As part of the study, ESI will quantify how many residents and non-resident workers pay the EIT to other municipalities. In addition, the firm will estimate the total proceeds that could be realized by implementing a 1 percent EIT on people who work in Falls Township.
Falls Township is one of few municipalities in Bucks County that has not enacted an EIT, which allows for an up to 1 percent levy on wages for workers who earn $12,000 or more annually.
When ESI conducted a similar investigation prior to Bensalem Township implementing an EIT, the firm determined that a 1 percent EIT would raise more than $11 million in revenue for the municipality. Of that, approximately $3.4 million would amount to new taxes for Bensalem residents.
Falls officials have not yet decided whether an EIT will be instituted. The ESI study is the first step in analyzing this possibility. ESI anticipates providing a report of its findings in the next few months. As part of its work, the firm will investigate the circumstances surrounding an EIT and complete a phase one and phase two report at a total cost of $20,000.
