News and Analysis
Ohio’s combined state and local income tax collections per capita are 16th highest in the nation, according to a revised report from the Tax Foundation. As of FY 2017 (the latest year available), state and local income taxes in Ohio were $1,207 per person, not much more than the U.S. average of $1,198. However, collections varied widely from state to state, ranging from $2,877 per person in New York to zero or nearly zero in nine states. 3/10/2020
Ohio does not fare well in WalletHub’s new comparison of state and local tax rates. The financial website compared the tax rates of the 50 states and D.C. — and their impact on the U.S. median household — and found Ohio was the 44th most expensive. According to the study, Ohio’s effective state and local tax rates on the U.S. median household is 13.14% — or $7,962 — roughly 22% more than the U.S. average. 3/11/2020
On Thursday, Ohio’s Office of Budget and Management released preliminary February 2020 revenue data, showing the state’s total General Revenue Fund tax receipts finished the month $111 million (7.2%) above estimates. Fiscal-year-to-date tax receipts through February exceeded estimates by $249 million (1.6%) and were more than $475 million (3.1%) over total tax receipts through the same period last fiscal year. 3/5/2020
The latest “Manufacturing Minute” — published by OMA Connections Partner GBQ — contains an update on state and local income tax nexus as affected by the U.S. Supreme Court’s ruling on South Dakota v. Wayfair. The publication also contains information regarding ESOPs, new lease accounting guidance, and accounting for indirect job costs. 3/2/2020
Ohio’s Unemployment Insurance (UI) Trust Fund — funded by employers — has the fifth worst solvency rate in the nation, according to a newly revised report from the U.S. Department of Labor. It’s estimated the fund could pay for just four months of benefits during a recession. Even without a recession, the fund could be broke by 2025.
While Ohio’s UI system is paying out more than it takes in, a temporary freeze on benefits was allowed to expire on Jan. 1. 3/2/2020
Earlier this month, Sens. Michael Rulli (R-Salem) and Sean O’Brien (D-Bazetta) introduced Senate Bill 257, designed to make Ohio — and particularly the Mahoning Valley — the nation’s leader in the electric vehicle revolution. The bill would create two different tax credits:
- A sales tax credit for the purchase of an electric vehicle; and
- An income tax and commercial activity tax credit for the purchase and installation of a charging station for an electronic vehicle.
This week, the OMA Tax Committee held its first meeting of 2020. Guest speaker Peter Voderberg, Gov. Mike DeWine’s assistant policy director for taxes, briefed members on what the administration is doing to keep Ohio’s tax climate competitive for manufacturers.
Representatives from Huntington National Bank, an OMA Connections Partner, presented best practices to safeguard payments and company financial assets. Members were updated on significant changes to Ohio’s Job Retention Tax Credit, and were briefed on the status of OMA-supported House Bill 440, legislation that would exempt temporary manufacturing labor from the sales and use tax.
The next meeting of the OMA Tax Committee will be Wednesday, June 10. All members are welcome to register. 2/12/2020
All 50 state governments receive large amounts of financial assistance from Washington. A new comparison by the Tax Foundation shows that the states most dependent on federal funds as of FY 2017 were Montana (46.1% of total the state’s general revenue), Wyoming (44.5%), and Louisiana (43.7%).
Ohio made the top 20 list of dependent states, with nearly 34% of its total revenue from the federal government — although four of Ohio’s five neighboring states were even more dependent on D.C. dollars. 2/17/2020
An efficient, competitive tax system is one of the OMA’s top policy goals. With that in mind, the OMA Tax Committee will meet Wednesday, Feb. 19, at 10 a.m. in Columbus for its first meeting of 2020. Participants will receive updates and analysis of tax-related activity, including legislation in the General Assembly such as House Bill 440, an OMA-supported bill to provide tax relief to manufacturers. Register today. 2/11/2020
An array of tax-related limits that affect businesses are annually indexed for inflation — and many have increased for 2020. OMA Connections Partner Clark Schaefer Hackett has compiled this list of some of the indexed provisions that may be important to your business. 2/12/2020