The Ohio joint House/Senate conference committee recently submitted a revised tax reform package. The tax package, which is subject to change as hearings proceed this week, calls for $2.6 billion in tax cuts for all Ohioans over the next three years.
As proposed by the House/Senate conference committee, the plan includes:
- Cutting personal income tax rates 10% across the board, phased in over three years (by 8.5% in 2013, 9% in 2014, and 10% in 2015 and beyond)
- Excluding from income tax 50% up to $250,000 (maximum exclusion of $125,000) of each owner or partner’s share in a pass-through-entity
- Increasing the state sales tax rate from 5.5% to 5.75%
- Lowering the threshold, from $1 million to $500,000 in taxable gross receipts, at which a company must begin paying the full CAT rate
- Suspending for three years the inflation-indexing adjustments of the nine income tax brackets and the personal and dependent exemptions
- Repealing the $20 personal exemption credit under the personal income tax
- Subjecting the sale of electronically transferred digital books or digital audio or audiovisual works to sales tax
- Limiting eligibility for the property tax homestead exemption for first-time applicants to those with less than $30,000 in annual income
- Eliminating the 12.5% residential property tax rollback on any new and replacement tax levies
Stay tuned for more details as the Ohio Legislature works this week to approve the budget and other key pieces of legislation before the summer break.