Thursday, August 28, 2008

Is Ohio's personal income tax in danger of extinction?

Is Ohio’s personal income tax in danger of extinction? We don’t really think so, but an article in the Cleveland Plain Dealer, Tuesday morning, cites a Buckeye Institute study “asserting that cutting the state’s $9.1 billion-a-year in income tax revenue would cause a doubling of all other state tax revenues in five years or less.”

“Liberal-leaning think tank” Policy Matters Ohio’s 2006 “State Economic Growth & The Public Sector” study opted an alternative view.

HB 534, introduced in April, would phase out Ohio’s personal income tax over the next ten years, and repeal the withholding tax on trusts and pass-through entity withholding tax for taxable years after 2018.

There are seven states in the country that don’t have incomes taxes, and another seven that have “flat rate” income tax; two more income taxes limited to dividend & interest income alone.

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