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Ohio


Ohio House Republicans want a smaller income tax cut than Gov. Kasich
In exhange, they would not increase drilling taxes or expand the sales tax
by WKSU's STATEHOUSE CORRESPONDENT BILL COHEN


Reporter
Bill Cohen
 
Ohio House Finance Chair Ron Amstutz proposes a smaller income-tax cut and no boost in fracking or sales taxes.
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If Republicans who control the Ohio House get their way, Ohioans will get a smaller income tax cut than the one proposed by Gov. John Kasich. But  they also will not face the prospect of having to pay a sales tax on dozens of new services. House Republican leaders have just unveiled their alternative  tax reform package. As statehouse correspondent Bill Cohen reports, it’s getting mixed reviews.

COHEN: The House Republican budget plan abridged version

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COHEN: The House Republican budget plan

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If House Republicans get their way, Gov. Kasich’s proposed 20 percent income tax cut for families – and 50 percent for businesses – would be much smaller – about 7 percent for each. But  House Finance Committee Chairman Ron Amstutz  says that comes to a $1.5 billion cut over the extw two years. And business lobbyist Roger Geiger says it’s what business wants.

“The 7 percent still a pretty dramatic cut for the almost a million small businesses that pay their business taxes through their income tax.”

As importantly, the House bill would not follow-though on Kasich’s proposal to pay for the tax cut by expanding a 5 percent state sales tax to services businesses use, such as lawyers, consultants and advertising.

“You can’t take money out of one pocket and put it in another pocket,” Geiger says.  “We needed an overall tax reduction.”

But conservative economist Richard Vedder at Ohio University says slashing the income tax is the best way to attract businesses and jobs. And he characterizes the House approach as a “non-courageous approach.” It doesn’t “annoy the special interests, but it not a dynamic approach that will make Ohio competitive.”

House Republicans also are once again ditching Gov. Kasich’s plan to hike taxes on a type of oil and gas drilling known as fracking.” House Speaker Bill Batchelder says the state can’t do anything to dampen the boom.

“I don’t think we want to put up a ‘get out of here sign,’” Batchelder says.

Democrats also are critical of the governor’s budget, and of the House budget. Rep. Matt Lundy of Elyria says the state should be taking extra money and restoring cuts to cities, schools and government programs for poor and elderly people, all of which were cut in the last two-year budget. 

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