Ohio Senate Republicans' budget proposal would reduce taxes throughout the state by $600 million over the next two years and re-establish some business tax subsidies that had been removed in the House Republican version of the budget bill.
“[Taxpayer should] have more money to spend on their families and their businesses and keep Ohio growing,” Sen. Matt Dolan, R-Chagrin Falls, said in a news conference Tuesday afternoon, when details of the plan were unveiled.
The Senate Republican plan goes further on tax cuts than the House Republican plan went. The Senate’s plan to cut $600 million worth of taxes was six times larger than the House’s plan to cut $100 million in taxes.
Both chambers proposed ending the income tax for anyone who makes $22,500 or less, but the Senate plan also provides an across-the-board eight percent tax cut that will be phased in over the two-year budget term. The plan would cut taxes by four percent in 2020 and another four percent in 2021. The House plan provided a 6.6 percent tax cut over the two years.
Dolan said these tax cuts would allow Ohioans to reinvest in the state’s economy.
The Senate plan also would fully restore the small business investment tax credit, which the House plan had reduced. Under the House plan, the tax subsidy would have exempted businesses from paying full taxes on their first $100,000 of income, but the Senate plan shifts that back to $250,000.
Additionally, the Senate plan would restore funding for the motion picture tax credit program, which is a $40 million annual subsidy accessible to film makers. It funds about 30 percent of all film activity in the state. The Senate plan would also expand accessibility to Broadway-style shows. The credit can be accessed through the income tax, the financial institutions tax or the commercial activity tax. The House plan had axed this entire program.
Senate Majority Leader Larry Obhof, R-Medina, said during Tuesday's news conference that Senate Republicans don’t disagree with the motives of Republican Gov. Mike DeWine or House Republicans, but are building on their proposals.
The Senate's proposed budget includes additional funding for education, the local government fund and clean water programs.
The budget allocates more money to school construction and to schools that have had an increased enrollment as well as to wraparound childcare programs. The Senate bill would provide $550 million for these programs over the next two years, which is equivalent to DeWine’s proposal, but slightly less than the House’s proposal of $625 million.
The Senate plan funds DeWine’s H2Ohio initiative, which creates a multimillion dollar trust fund designed to help preserve the state’s lakes and rivers. Over the course of two years, the plan allocates about $170 million toward the fund. The Senate plan also includes $2 million more in other clean water initiatives.
Republicans have a majority in the House and Senate, as well as the governor’s seat.