The subject of how to lure business into Philadelphia, given the city's high taxes, was among the prime topics this morning as several of the mayoral candidates spoke before leaders of the business community.

And the subject produced a pointed exchange between Democrats Chaka Fattah and Michael Nutter.

At the forum, Fattah discussed his plan to bring in outside businesses. It calls for letting them pay the city's business taxes or the taxes in their current locations, whichever is less, for the first five years.

Nutter challenged the fairness of the concept, saying it would put existing local businesses at a competitive disadvantage.

Fattah replied that the idea of giving out tax breaks on a selective basis to help the city's economy is already in place – both in the tax abatements for new residential construction and in the various geographic zones where businesses get tax exemptions.

"This is the same concept that all of us are applauding under other circumstances," Fattah said.

The two candidates also clashed over what to do about the gross receipts portion of the business privilege tax, the part companies must pay even if they make no profits.

Fattah called for eliminating the gross receipts levy immediately. But he would make up the lost $98 million through a revised tax on business income. He said that the need to provide essential city services requires the business community to pay no less in taxes than it is paying now.

Nutter wants to phase out the gross receipts portion over five-to-seven years and gradually reduce the income portion as well, saying that an overall reduction is needed to spur job-creation.

Democrat Dwight Evans, who also attended, said that he would seek as much of a business tax reduction as the city could afford, stressing the need "to strike a balance" between tax cuts and providing city services.

Republican Al Taubenberger endorsed cutting business taxes over time.

The two other invited candidates, Democrats Bob Brady and Tom Knox did not attend the forum, which was sponsored by the Greater Philadelphia Chamber of Commerce and the Delaware Valley Healthcare Council.

Contact senior writer Larry Eichel at 215-854-2415 or leichel@phillynews.com