During his budget address to City Council on March 2, Philadelphia Mayor Jim Kenney said that among the nation’s 10 largest cities, Philadelphia ranked first in poverty and last in job creation.

Kenney also noted that Philadelphia even trailed perpetually economically distressed cities like Baltimore and Detroit.  Then the mayor said this: “Nearly every task force, commission, committee and working group that has looked at how to improve Philadelphia’s economy has noted that our tax policy consistently holds us back.”

It was a blunt and honest appraisal, something you rarely hear from a politician.

In recent years, the city has incrementally reduced some of its most onerous taxes, including a wage tax that’s much higher than Philadelphia’s suburbs. Some 60,000 small businesses in Philadelphia no longer pay a Business Income & Receipts Tax, commonly known by the acronym BIRT, as a result of a reform that exempted the first $100,000 of a business’s gross receipts from the tax.

Another reform in 2013 exempted all new businesses that create three jobs in their first year of operations and have six employees by the end of the second year from BIRT for the first two tax years of operations in the city.

But the reforms have done little to really goose the city’s economy. We need to take a bigger bite out of BIRT if we want to speed up growth. BIRT levies a 1.45 percent tax on a business’s gross receipts above $100,000 and 6.45 percent tax on taxable net income. Every individual, partnership, association or corporation engaged in a business, profession or other activity in the city must file a BIRT return, even if they did not have taxable income during the preceding year.

BIRT, which accounts for 14 percent of the city’s general fund revenue, is expected to generate $445 million for the city in the fiscal year that ends June 30.

When you have to write a check to the city for 1.45 percent of gross sales over $100,000, that’s money a business doesn’t have to reinvest in the business or hire new workers.

Consider a business that had $1 million in gross sales in Philadelphia in 2016. That business would have to pay $13,050 to the city plus 6.45 percent of whatever taxable net income they had.

A few weeks after Mayor Kenney gave his budget address, TechNet and the Progressive Policy Institute released a report that identified 15 “emerging” tech hubs, ranking Philadelphia No. 10 on the list. (StartupPHL says there are 5,100 tech businesses in the city.)

TechNet said the emerging hubs were likely to be more successful if they followed an agenda that included tax incentives to encourage investment in local companies and a pro-innovation regulatory and fiscal policy that reduced the burden of taxation and regulation on small companies.

A good place for Philadelphia to start would be to abolish the gross receipts portion of BIRT.  That’s money that could be better used for business growth and job creation.