05/14/2019

Income Tax Cut Among Latest Changes to State Budget

Business groups have opposed the change

An across-the-board income tax cut, more transparency on health care costs and a 50 percent increase in the law’s minimum base salary for teachers were among the latest wave of state budget changes by the Ohio House on Wednesday.

Part of a two-year budget that got bipartisan support, the latest changes eliminate taxes on income below $22,500, erasing the state’s bottom two tax brackets. The budget also proposes a 6.6 percent tax reduction on all remaining income brackets, which would put the new top tax rate at 4.67 percent, down from the current 5 percent, on income above $222,200.

The tax plan, which House Republicans say is a net $108 million annual tax cut, also significantly scales back the current business-income tax deduction that allows partnerships, LLCs and sole proprietors to pay no income tax on up to $250,000 in income, plus get a 40 percent tax cut on income over $250,000.

Please select this link to read the complete article from The Akron Beacon Journal.