The 2.75% flat income tax in the Senate budget got the approval of all but one Republican senator, and House Republicans who favor tax cuts seem to like it as well. But there’s one key Republican who may be showing doubts. And he has the power to strike the idea entirely.
Gov. Mike DeWine hasn’t proposed an income tax cut in any of his four budgets, and has said no company has ever told him they wouldn’t come to Ohio because its income taxes were too high. He’s not a fan of the flat income tax idea, which is a cut for Ohioans making over $100,000 a year. Senate Republicans added the flat income tax proposal to their budget, taking Ohio's two existing tax brackets down to one. All Republicans but Sen. Bill Blessing (R-Colerain Twp.) voted for the budget that includes that flat tax plan.
DeWine told reporters in Mason on Tuesday that he still likes the $1,000 tax credit for working parents with young kids that he proposed, which would have been funded by a hike in cigarette taxes.
"The type of income tax cut we need in Ohio is to help working families. And the best income tax to help working families is a child tax credit that I have proposed, which would be $1,000 for every child under the age of five that you have. That will help these families function better, will help take some pressure off of them," DeWine said. "That's the type of tax cut that we really, really need. So that's the only tax cut I'm in favor of. That tax cut makes sense. And it's what we should do. And I hope the legislature, as we go through this process, will look at that."
Legislative Democrats have praised DeWine's child tax credit idea as well. Republicans in the House stripped it from the budget early on, saying there was no appetite to raise any taxes.
DeWine’s budget director isn’t forecasting a recession, but told the budget conference committee earlier on Tuesday that the state will likely see a decelerating economy. DeWine has issued 83 line item vetoes in the past three budgets, but none have been on tax cuts.
DeWine was also asked by reporters if he favored the Senate's plan to use unclaimed funds to set up a sports facilities fund, which would offer $600 million to the Cleveland Browns for the domed stadium development in Brook Park. DeWine still favors his initial proposal, which was to double the tax on sports gambling operators.
"I think by far the most logical way to get this money, to help build our stadium stadiums in the future—not just the one in Cleveland, but throughout the state of Ohio—is to tax the people that are making the most money. And the people who are making the most money are these out-of-state companies," DeWine said, referring to the sports gambling operators. "We need to tax them more. And if we could do that, we will be able to take some of that money and put it in new stadiums. It seems to me kind of poetic justice; that the people are making the most money from these stadiums or the people who are in the gaming business, they need to pay more."
DeWine has long been critical of sports gambling in Ohio. He proposed doubling the tax on sports gambling in his first budget from 10% to 20%. And during his time in office, gambling companies have been sanctioned by the Casino Control Commission for breaking the law in their ads and marketing to people under 21 who are too young to legally gamble.
