Governor's Budget Proposal A Mix Of Tax Cuts, Increases

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Gov. Kasich had already announced that his budget would include a $523 million dollar tax cut, from a 23% across the board income tax cut and the elimination of income tax cuts about a million small businesses.

And it includes the doubling of the personal income tax exemption for lower-income Ohioans and the plan to expand subsidized day care to people making up to 300% of the federal poverty level.

And as expected, the governor proposed paying for this with a package of tax increases: a dollar increase in the tobacco tax, raising it to $2.25; a 6.5% increase in the tax on oil and gas drillers; a 25% increase in the commercial activity tax or CAT; and a half-percent hike in the sales tax to 6.25% and a broadening of the tax to currently non-taxed services.

Lawmakers revised down a previous sales tax increase, rejected his previous attempts to hike the drillers tax, and didn't even hold hearings on last year's 60-cent tobacco tax increase.

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