With Ohio currently swimming in an estimated $1.4B budgetary surplus, Senator Steve Huffman says it’s the right time to end the income tax. At the beginning of May, he introduced a bill to get the ball rolling.
Here’s Five Fast Facts about The Possible End of Ohio Income Tax:
- 🔽How and When? - Huffman’s proposal will lower personal income tax by 10% annually over the course of 10 years until it’s gone.
- 📆Why Now? - Even after four sets of tax cuts between 2010 and 2019, income tax revenue still went up from $7.8B to $9.3B. Huffman says this proves the Laffer Curve (a theory that says high taxes discourage taxed activities) is a real thing.
- 🇺🇸We’re Not Alone - It’s working in other states, red and blue alike. Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming all have eliminated income tax and payroll tax (except for unemployment taxes). The Tax Foundation even ranks four of those states in the top five on their State Business Tax Climate Index that shows how well states structure their tax systems.
- 💸Who’s Paying? - Huffman said he won’t raise other taxes to make up the difference because the income tax repeal will stimulate economic and job growth across the state. He hasn’t shown any formal data to back this up, but his reasoning kind of makes sense.
- ✋Not so fast - Critics say cutting the income tax will put an undue burden on the bottom 20% of residents, pointing to data from a February report from the Institute of Taxation and Economic Policy. They also note Ohio’s flat sales tax will heavily impact that same bracket.
🔥Bottom line: Eliminating income tax is not a new concept and those nine other states have not turned into post-apocalyptic wastelands. If the bill is structured properly and fairly, everyone really would benefit from its implementation.
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