(The Center Square) – Ohioans would no longer pay state income tax and the state would become the 10th without it if a bill recently filed in the state Senate becomes law.
Sen. Steve Huffman, R-Tipp City, introduced a plan to lower the tax rate in each bracket by 10% a year over the next 10 years, eventually eliminating the state income tax completely.
"The time has come for Ohio to join Alaska, Florida, New Hampshire, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming in eliminating the state income tax," Huffman said. "With Ohio’s growing, prosperous economy and robust Rainy Day Fund, this plan is sustainable and builds on the work of previous general assemblies."
Senate Bill 327, according to Huffman, is a natural progression of tax cuts and tax bracket reduction over the last 10 years. The state trimmed the number of brackets from nine in 2011 with the highest rate at 5.925% to four in 2021, with the highest rate at 3.99%.
Huffman expects the bill, if fully implemented, would save Ohio taxpayers nearly $830 million annually.
It’s the second time Huffman has taken a shot at lowering taxes this year.
Earlier, he introduced legislation that would scale back the state’s gas tax to pre-2019 levels for at least five years.
Huffman said the billions of dollars coming to the state from the recently passed federal infrastructure law more than offset the money collected from higher taxes imposed in 2019.
The state raised the gasoline tax 10.5 cents a gallon in 2019 after DeWine proposed an 18.5 cents increase. It also raised the tax 19.5 cents a gallon for diesel and created an additional registration fee for alternative-fuel vehicles.
Ohioans currently pay 38.5 cents a gallon in taxes on gasoline and 47 cents a gallon on diesel.
That bill, Senate Bill 277, remains in committee.