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Ohio Governor Proposes State Income Tax Increase

By The Pullins Group LLC

Ohio Governor Ted Strickland, stung from an adverse Supreme Court decision, today proposed hiking state income taxes by nearly $1 billion.  Strickland argues that this doesn't really raise income taxes because the tax rates will be the same as last year.

Bullshit Governor, this is a tax increase.  Let me explain.

Under current law, the income tax rates for Ohioans are set for next year.  To change those rates it will be necessary to pass a bill to raise those rates higher than they are under current law. 

THAT IS A TAX INCREASE!!  If it raises nearly $1 billion a year more, that money has to come from somewhere.  Nearly $1 billion dollars next year would be transferred out of the pockets of Ohioans and into the pockets of Ohio's state government. 

And much of this money would come out of the pockets of small businesses.  Most small businesses are closely held and don't pay income taxes.  Instead, their annual revenue is passed through to their owners who pay personal income tax on it.  When Republicans ruled state government they temporarily raised the state sales tax instead of the income tax because of the severe impact an income tax hike would have had on small businesses.

According to the nonpartisan Tax Foundation, Ohio has the 47th worst tax climate for business in the country.  Much of that is because of Ohio's already too high income taxes.  Raising Ohio's income tax rates by 4.2%, a nearly $1 billion tax hike, would only make this situation worse.

Full post as published by The Pullins Report on September 30, 2009 (boomark / email).