Like the gambling addict who claims he’s buying lottery tickets to “help schools and the kids” Gov. Kasich wants to sell us on a delusion. Take his plan to cut small business taxes by 50%.
Please.
The Governor says it’s all about job creation. “Small businesses,” he endlessly intones, “are the job creators in this state.” If we just cut their taxes by 50%, a virtual tsunami of hiring is sure to follow.
Just one small problem.
According to the Cleveland Plain Dealer, less than 2% of Ohio’s 717,000 small-business owners who qualify for the cut would save enough to hire even one minimum wage worker. In fact, 80% of Ohio’s small businesspeople would get less than $400 per year.
400 bucks a year? How many workers can you hire with that? [Read more…]
The Kasich administration’s proposed expansion of the state’s sales tax to services as well as goods is not a new idea. Several states have been down this road recently, including Ohio. The results of those efforts have been consistent: taxing services is so unpopular — both among consumers and businesses — that every attempt in the past four decades has been undone before taking effect or shortly thereafter.
We looked at three such examples. [Read more…]
Governor Kasich’s budget raises the rate of Ohio’s severance tax, charged when drillers extract oil and natural gas from Ohio’s shale, but would preserve our tax rate as one of the lowest among all oil and gas producing states.
According to the administration, these changes will raise $200 million in new tax revenue over the next two years, but is dwarfed in comparison to the $2.9 billion in new sales taxes Ohioans are being asked to pay in the budget, resources that will support another income tax cut that will mostly benefit the wealthiest Ohioans.
It’s important for policymakers to consider whether the new tax rate is sufficient.Based on production estimates from the Ohio Department of Taxation, we attempted to compare the estimated revenue from Governor Kasich’s proposal to what Ohio could collect at varying tax rates, including those in place in other oil and gas states. [Read more…]
The two-year state budget announced last week includes a proposed to massively shift the cost of paying for government away from the income tax – the state’s most progressive tax, based on one’s ability to pay – toward more reliance on the sales tax. Here are the specific components of the plan:
Sales tax: net tax increase of $2.9 billion
Expand the sales tax to cover all “non-essential” services individuals and businesses purchase: raises $4.4 billion
Lower the sales tax rate from 5.5 to 5 percent: costs $1.5 billion [Read more…]
Three of the six new money school levies on Tuesday’s special election ballots failed.
The Midview levy passed with 62% voting in favor of the property tax. The Jackson Center levy passed after failing by only 3 votes in the November election. Waterloo Schools levy passed by just 25 votes, or 50-49%.
The failure of the levies for the Hillsdale, Coventry and Edison districts could result in immediate consequences. Hillsdale may be forced to lay off as many as 19 staff members to close a $1.7 million deficit, and Edison has said it will eliminate busing and close an elementary school.
The three levies that passed will add to the $487 million in new taxes Ohio residents have voted to put into effect since the Kasich budget — which left schools with $1.8 billion less funding — was introduced.
Policy Matters Ohio
Today Policy Matters Ohio released a report showing that the net effect of Governor Kasich’s tax reforms in his proposed budget would overwhelmingly favor the wealthiest Ohioans.
The analysis shows that Ohioans in the top 1 percent of incomes would receive an annual tax cut of $10,369, while families in the bottom fifth — making less than $18,000 a year — would pay $63 more a year. Ohioans in the middle — making between $33,000 and $51,000 — would see an increase of about $8 a year.
On Monday, Governor Kasich was emphatic that this budget includes tax cuts for every Ohioan. Unfortunately, the analysis shows the only Ohioans guaranteed to see any sort of tax break are those in the highest income brackets. The rest of us will pay more.
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Voters in nine Ohio counties will vote on local school levies tomorrow. All of the levies to be considered are requests for new money.
This seems to be the trend in the aftermath of Kasich’s $1.8 billion in cuts to school district funding. We have seen an unprecedented $1.1 billion in new property and income taxes for schools since Kasich’s last budget. On Tuesday, there will be 5 school districts asking for money to use on operating costs in 8 counties. There is also a levy on the ballot in Summit County, but it’s for construction projects so it’s not related to the schools who are struggling to maintain operation.
[Read more…]
For Immediate Release: January 29, 2013
Contact: Dale Butland, 614-783-5833
Kasich Budget Cuts = $1.1 Billion in School Levies
IO Blows Whistle on “Kasich Shell Game”
Columbus – Innovation Ohio, a progressive think tank headquartered in Columbus, released an analysis today proving what Kasich Administration critics have long suspected: the Governor has merely shifted the responsibility for adequately funding Ohio schools from the state to the local level.
Specifically, IO’s analysis finds that since May, 2011, a record-breaking $1.1 billion in local property and income tax levies earmarked for schools has appeared on local ballots. Voters approved just 40% – or $487 million – leaving numerous school districts across the state scrambling to maintain needed academic programs and staffing levels.
IO stressed that the $1.1 billion figure includes only new operating money, not renewal or replacement levies or money for capital projects.
[Read more…]