PHILADELPHIA (CBS) – Mayor Nutter is warning of dire consequences to the city’s budget after Philadelphia City Council — ignoring his pleas — voted to roll back the tax on fees at parking garages and parking lots.

The city’s parking tax was raised three years ago, from 15 percent to 20 percent.  The parking industry this year aggressively lobbied City Council for relief, and today it came.

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By a 12-5 vote, the lawmakers approved Councilman Jim Kenney’s bill to gradually roll back the parking tax to 17 percent, starting in 2014.

“Because they pay 25 dollars out of every 100 dollars they raise in taxes — what other industry pays that?’ Kenney said today, defending the measure.

But Mayor Nutter says rolling back the parking tax will cost the city $24 million over five years — something he argues that Philadelphia can’t afford.

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“I don’t know why the parking industry is so special that they should be getting action taken on reducing their (tax) rates now,” the mayor said.

The parking industry argues that the lost revenue could be reclaimed simply by having city auditors going after rogue parking lot operators who don’t pay taxes.

A mayoral veto of the measure is expected, though Nutter refused to confirm that.  The 12-vote approval would potentially be enough to override a veto.

Reported by KYW City Hall bureau chief Mike Dunn

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