Tax and Finance Management

Superfund Excise Tax Returns July 1

Certain manufacturers and importers of chemicals will soon be liable again for the Superfund Excise Tax. OMA Connections Partner Schneider Downs has published this insight, which notes that the reinstated tax will be effective July 1, 2022 through Dec. 31, 2031, absent extension.

The latest reiteration of the excise tax will be comprised of two separate taxes on chemical sales and chemical importers. Impacted companies should closely monitor the changing guidance. 5/18/2022

Automation Beyond the Plant Floor

Despite the technological advancement occurring throughout manufacturing today, administrative functions at many manufacturing businesses still depend on manual practices. For example, accounts payable practitioners spend hours on manual, repetitive tasks, thereby hindering productivity and opening the door to human errors.

OMA Connections Partner Paymerang reports that 64% of hours spent on manufacturing-related activities could be automated with existing technologies, with office processes showing great potential for automation. By automating accounts payable functions, manufacturers can reallocate time and resources to other areas of business, according to Paymerang. Learn more. 5/19/2022

Ohio’s Tax Revenue Fund Hits $3.3 Billion

Ohio’s General Revenue Fund (GRF) reached a record high in April with $3.3 billion, according to the state’s latest monthly financial report. The GRF, which houses most tax revenues to fund government operations and public services, eclipsed the previous record of $2.9 billion, set in May 2021.

April revenues exceeded the monthly estimate by $1 billion (45.6%), and fiscal year-to-date tax revenues exceeded estimate by $2.5 billion (12%). The personal income tax drove the month’s historic collection, generating $1.9 billion and exceeding the forecast by $894.7 million (89.2%). 5/12/2022

Economic Roundup: The Good, Bad, and Ugly

Recent economic indicators for both the U.S. and Ohio show a mixed bag, including the following:

The Good: The U.S. economy added 428,000 jobs in April and weekly jobless claims have dropped to their lowest level since January 1970. Manufacturing employment rose by 55,000 in April, the strongest monthly gain in nine months.

The Bad: There was a slight drop in the already-low U.S. labor force participation rate, which is currently 62.2%. Nationwide, the number of unemployed people per job opening is 0.5. Meanwhile, consumer inflation remained very high in April at 8.3% from a year ago, while producer prices at the wholesale level rose 11% over the past year.

The Ugly: U.S. labor productivity plunged 7.5% during the first quarter of 2022, marking the largest quarterly decline since 1947. (However, manufacturing productivity increased 0.7% in Q1, as output increased 5.7% and hours worked increased 5.1%.) 5/12/2022

Study: Ohio Offers Competitive Property Tax Structure

Ohio offers one of the nation’s most competitive property tax structures, according to the non-partisan Tax Foundation. The organization’s updated research shows that Ohio imposes the nation’s sixth-smallest property tax burden based on an evaluation of state and local taxes on real and personal property, net worth, and asset transfers. This map shows the property tax rankings of all 50 states. 5/12/2022

The Impact of Rising Interest Rates on Manufacturers

The Federal Reserve has communicated its intention to continue increasing rates into 2023. OMA Connections Partner HBK has published this list of ways that interest rates could impact manufacturers’ revenue. The summary includes a list of actions manufacturers can take to prepare for possible demand fluctuations caused by higher rates. 5/4/2022

Guidance: Revisit Tax Rules Amid 2022 Challenges

Businesses and individuals should revisit existing tax rules as a means of confronting broader economic and supply chain challenges, according to this insight from OMA Connections Partner Plante Moran. Businesses may want to consider accounting method planning, analysis of research and experimentation costs, and revisiting the employee retention credit for 2020 and 2021. 5/3/2022

Insight Into EX-IM’s U.S. Manufacturing Initiative

OMA Connections Partner Squire Patton Boggs has published this summary of the “Make More in America” initiative approved last month by the Export-Import Bank of the United States (EX-IM) board. As the summary explains, for the first time, the agency’s existing financing programs will be available to export-oriented domestic manufacturing facilities and infrastructure projects.

“Businesses seeking competitive financing options should consider this program, which seeks to promote U.S. manufacturing competitiveness,” the firm writes. 5/5/2022

Bill Would Phase Out Ohio’s State Income Tax

Under new state legislation (Senate Bill 327), Ohio’s personal income tax would be phased out over the next 10 years. As reported by Cleveland.com (subscription), the bill — which has been sponsored by nearly a third of GOP senators — would make Ohio the eighth state to vote to abolish its personal income tax. It would also eventually create an annual revenue deficit of more than $10 billion based on current state spending. 4/27/2022

Study: Ohio’s UI Tax Among Most Competitive in U.S.

The Tax Foundation ranks Ohio as the tenth best state for unemployment insurance (UI) taxes paid by employers. According to the Foundation, the least-damaging UI tax systems are those that adhere closely to the federal taxable wage base, have low minimum and maximum tax rates, avoid levying surtaxes or creating benefit add-ons, and have straightforward experience formulas and charging methods. See the rankings of all 50 states. 4/28/2022