News and Analysis
Nearly $100 billion in duties have been collected by the U.S. Customs and Border Protection (CBP) through former President Donald Trump’s tariffs on Chinese goods. Politico reports that even though the rate of collections has slowed as companies switched to other foreign suppliers, the tariffs figure dwarfs the $10.9 billion CBP has collected from Trump’s steel and aluminum tariffs. A broad coalition of business groups has pressed the Biden administration to lift the tariffs. 7/19/2021
The SBA has informed lenders that Loan Necessity Questionnaires (Forms 3509 and 3510) are no longer required to be submitted by Paycheck Protection Program (PPP) borrowers. Borrowers who have already been asked to complete the questionnaire don’t need to submit the form. However, they still need support for certifications related to the necessity of the PPP loan request.
OMA Connections Partner CliftonLarsonAllen has published this summary of the latest PPP developments. 7/21/2021
As we reported earlier this month, Ohio’s FY 2022-23 budget contains significant tax law changes, rate reductions, and municipal income tax reforms. Many of the changes are effective retroactive to Jan. 1, 2021.
This week, FOX Business spotlighted Ohio’s recent tax relief and other changes in the state’s FY2022-23 budget. The network’s story notes that manufacturers like Amgen, Peloton, and First Solar have made recent announcements about expanding investments in Ohio.
Lt. Gov. Jon Husted is quoted as saying that while state policymakers cannot change what’s going on at the federal level, he sees this time as an opportunity for Ohio, predicting that “capital is going to flee” to lower tax destinations. 7/15/2021
OMA Connections Partner CliftonLarsonAllen is reminding employers about a federal tax credit for hiring individuals from groups that have traditionally faced significant barriers to employment, including veterans, ex-offenders, and recipients of government assistance. The Work Opportunity Tax Credit can help businesses reduce their federal tax liability by up to $9,600 per eligible employee. 7/15/2021
Last week, a federal judge ruled that the Biden administration cannot prevent Ohio from providing tax relief to its citizens simply because the state accepted federal dollars from the American Rescue Plan Act. (As reported last week, Ohio’s new budget provides roughly $1.7 billion in personal income tax relief.)
In its July 5 editorial, The Wall Street Journal (subscription) cheered Ohio’s tax relief efforts, as well as the state’s legal victory — calling it “a double victory for taxpayers.” 7/6/2021
Ohio ended the fiscal year on June 30 with $1.54 billion (6.2%) more in tax revenue than originally forecast. Gongwer News reports that according to the Office of Budget and Management’s preliminary revenue tables, the state took in just under $26.5 billion in tax revenue over 12 months, compared to an estimate of $24.9 billion.
Compared to FY20, the state brought in $3.8 billion (17%) more in FY21.
State Budget Director Kimberly Murnieks said the variance could be attributed to a variety of factors, including soaring sales tax revenues. For the fiscal year, the sales-and-use tax beat estimates by more than $1 billion, or 9%, as the state collected nearly $12.2 billion in this category. 7/8/2021
Employers continue to raise questions about the Employee Retention Tax Credit (ERTC), which offers a federal credit of up to $5,000 per employee. OMA Connections Partner Clark Schaefer Hackett has published this summary of the ERTC, which includes guidance on how your company can claim the credit. 7/6/2021
If approved by Congress, the Biden administration’s tax proposals would significantly impact individual, corporate, and international taxes. The administration’s proposed American Families Plan would raise taxes by an estimated $661 billion; the proposed Made in America Tax Plan would raise taxes by $2.3 trillion.
OMA Connections Partner Plante Moran has published this insight to highlight the administration’s key tax proposals and what might be coming next. 7/8/2021
Republican House and Senate leaders reached a compromise in the new budget to provide a 3% across-the-board personal income tax cut. This relief will benefit small- and mid-sized employers that pay taxes on business income through an owner’s individual income taxes. Details include:
- The top income tax bracket (4.797%) for high earners has been eliminated, reducing the number of brackets to four — compared to nine brackets six years ago.
- Rates will be lowered for all income brackets.
- The rate of the new top bracket — applicable to those earning more than $110,650 in 2021 — will fall from 4.413% to 3.99%.
- Ohioans earning less than $25,000 will pay no state income tax.
The new budget is expected to result in nearly $1.7 billion in personal income tax relief over the biennium, while making Ohio more competitive. Senate Finance Committee Chair Matt Dolan (R-Chagrin Falls) noted that “only Indiana now is lower than us among surrounding states.” Senate President Matt Huffman (R-Lima) said he thinks the budget will deliver the largest personal income tax reduction in state history. 6/30/2021