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Kasich Proposes Huge Shift Away from Income Tax

Monday, February 4, 2013 at 5:25 PM

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Gov. John Kasich explains his proposed two-year budget. Photo by Karen Kasler / Ohio Public Radio Statehouse News Bureau

Gov. John Kasich is proposing a major shift in Ohio’s tax structure. Under his plan, just released, billions of extra dollars would flow in from an expanded sales tax -- but that would be more than offset by an even bigger lowering of the state income tax. Statehouse correspondent Bill Cohen helps us sort out the ups and downs in this report.

With additional reporting by Ohio Public Radio’s Karen Kasler:

Tax cuts are the highlights of Gov. John Kasich’s second budget, unveiled today. He’s proposing an income tax cut of 50 percent for small businesses and a 20 percent across-the-board income tax cut for all Ohioans over the next three years. Plus, he wants a drop in the state sales tax from 5.5 percent to 5 percent. Those cuts would be paid for in part by an increase in the severance tax on bigger oil and natural gas drillers, which Kasich knows worries some conservative lawmakers.

The governor is also proposing increasing the tax base by 30 percent by taxing legal, architectural, accounting and other services. The $63 billion budget also includes an expansion of Medicaid to include people making up to 138 percent of the federal poverty level, another proposal that may have trouble getting support from Republican legislators. The governor will discuss his budget at a town hall meeting tonight—it’ll be broadcast on the Ohio Channel starting at 7 p.m.

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Economy, Government/Politics

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