State Budget Proposal Would Halt County Sales Tax Increase
Governor Kasich’s proposed two-year state budget would restore $28 million dollars to the local government fund, but prevent local governments from raising sales taxes.
According to Gary Gudmundson of the Ohio Department of Taxation, over the next three years Franklin County would receive a 10 percent bump in revenue during the first 19 months and another 5 percent during the remaining period.
Anything above that rate would be kept by the county. Revenues from the state sales tax would be used to offset a 20 percent cut in the personal income tax and a 50 percent cut in the taxes small businesses pay, Gudmundson said. The Columbus Dispatch reported last week Franklin County Commissioners had been considering a sales tax increase.
Gudmundson said Ohio counties would see revenues rise because the sales tax would be applied to business services that are not currently subject to taxation such as accounting, legal and architectural services. The state sales tax would drop from 5.5 to 5 percent under Kasich’s proposed spending plan.
The governor’s spending blueprint is scheduled to go before the legislature next week.
Correction: The original version of this story erroneously reported the state would keep any revenues above ten percent generated by counties’ sales tax.