Analyzing Ohio’s State and Local Income Taxes

As previously reported, Republicans in the legislature want to reduce Ohio’s income tax, which affects individuals and businesses structured as pass-through entities. (This infographic illustrates Ohioans’ total taxable income by source.)

House Bill 1, which would lower the state’s top income tax rate to 2.75% (and make changes to local property taxes), received its first hearing this week. According to the non-partisan Tax Foundation, Ohio’s top rate (3.99%) is already the fifth lowest of the 43 states that tax personal income.

It’s important to note that 16 states — including Ohio, with its municipal/school district income tax — allow local income taxes, which can significantly add to the tax burden. 3/1/2023