Legal Challenge Posed to Ohio’s Local Income Tax

A conservative think tank in Ohio has challenged a recent state law intended to protect local income tax revenue during a time when many employees are working from a different municipality than their employer’s workplace.

Earlier this year, the OMA and numerous other business interests supported House Bill 197, bi-partisan legislation that contained numerous COVID-19 relief measures. HB 197 won unanimous approval in the General Assembly in late March and contained a provision to extend Ohio’s “20-day rule” for municipal tax withholding for employees who are now working from home.

The Buckeye Institute argues that allowing cities to continue collecting taxes from employees who are now working in other municipalities is an unconstitutional expansion of their taxing authority. WOSU radio reports on this development. The lawsuit is pending in the Franklin County Common Pleas Court. The OMA Tax Committee will discuss the issue at its next meeting. 7/16/2020