Reviewing Tax Cuts and Hikes in the Governor's Budget Update
Another big milestone in this election year was passed this week, as Gov. John Kasich unveiled his budget update bill, with lots of items that seem ready-made to note to voters this fall. The mid-biennium review, or MBR, features an across the board income tax cut of 8.5%, designed to bring the top tax rate down to below 5%. This tax cut comes courtesy of two increases in existing taxes – notably, they are two taxes that most voters have said in polls they have no real problem with being increased. One is a hike in the severance tax to 2.75 percent of gross receipts on big oil and gas drillers. The other proposal is a 60-cent jump in the per-pack cigarette tax, from $1.25 to $1.85. Anti-smoking activists say they're pleased, and so do advocates for the poor, though they admit this tax increase will hit their constituency very hard. The budget update also includes several items targeted at low-income Ohioans - it triples the non-refundable earned income tax credit, and it increases the personal deductions for people making under $80,000. But Democratic critics still say the tax cut benefits the wealthy far more than the poor, and that previous tax cuts haven't spurred the economy.
To talk about the policy and political implications of the items in this MBR are two guests who’ve been watching this rollout from their viewpoints. Mike Gonidakis is familiar to many observers as the president of Ohio Right to Life – he’s also a Republican analyst. Keary McCarthy is the chief of staff for the Ohio House Democrats.