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Government


Kasich budget has positives and negatives for low-income Ohioans
As Gov. Kasich moves to shift Ohio's income tax toward consumption-driven tax, advocacy groups worry about what it will mean for Ohio's poor.
Story by KELSEY LEYVA


 
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Gov. Kasich' latest budget update included plans to provide tax relief for low- and middle-income Ohioans. One advocacy group in Cleveland sees both positives and negatives.
LISTEN:Honeck on income tax cuts

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LISTEN: Honeck on how it plays out

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LISTEN: Honeck on education

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Kasich’s budget update released earlier this week calls for an increase in the Earned Income Tax Credit and the personal exemption for low- and middle-income Ohioans. The governor’s update also includes income tax cuts across all income levels.

Jon Honeck in the Director of Public Policy for the Center for Community Solutions in Cleveland. He says he’s pleased with the governor’s focus on improving the workforce.

“Some of the positives are the emphasis on workforce development and education," Honeck said. "Having programs around mentoring, some initiatives around dropout prevention and also reaching out to folks who never completed a high school diploma.”

Although Honeck says improving the workforce will help incomes and economic development, he says he is concerned with how the state plans to fund it.

“We are concerned overall about the revenue package that’s in here in the sense that the income tax is being cut, other taxes are being raised but overall it looks like it’ll be a net loss of money to the state," Honeck said. "And this comes on the heels of big tax cuts that occurred in the budget that was just passed last year and other big cuts to the income tax a few years ago as well.”

Honeck says the overall tax burden on low-income Ohioans may end up being a wash.

“What you might see is a decrease in the state taxes, which may in fact be offset by local governments having to increase their taxes to make up for some of those losses and the services that they can provide," Honeck said. "Part of this just really depends on how it plays out.”

Honeck says moving toward consumption based taxes, such as sales and property taxes, will be negative for low-income families. 

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