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Mon July 8, 2013
Studies: State Budget Will Hurt Ohioans' Pocketbooks
The Ohio Republican Party hails the new two year state budget as a win for taxpayers.
The Ohio Democratic Party says the budget hurts most taxpayers. Two reports from two different politically-oriented think tanks say the changes in the budget will hurt most Ohioans. But the studies have different takes on how and why. Ohio Public Radio's Jo Ingles reports.
The head of the union that represents corrections officers at most of Ohio’s prisons, Christopher Mabe, says this budget will make Ohio less safe.
Mabe – I think it’s accurate to say that with this Kasich budget, the millionaires have gotten the gold mine and the working class has got the shaft.
Mabe isn’t alone. Some school leaders say they are worried the budget doesn’t provide enough money to do what is required without raising local taxes and will find it even harder to do that now that the state won’t kick in money to help pay for new local levies any longer. Wendy Patton with the left leaning policy group, Policy Matters, says a new report shows the tax shift in this budget…which raises sales taxes yet lowers income taxes for individuals and businesses, is not good for most Ohioans.
Patton – The bottom quintile of all taxpayers would pay more under this package…about 12 dollars more a year whereas the top one percent of earners in Ohio would see a tax cut of about 6,083 dollars on average. The tax plan shifts the weight of the tax structure from top earners to middle and low income earners in the state of Ohio.
Patton isn’t the only one with a study that shows the tax shift in the budget isn’t good for Ohioans in the long run. Matt Mayer is the head of a group that normally likes tax cuts.
Mayer – We like tax cuts but we think they should be funded by spending cuts not by depending upon higher revenues that come in
Mayer says Governor Kasich and Republicans should have cut spending to make up for the tax cuts. Instead, he says this budget allows unsustainable long term debt. He says his study shows this tax shift plan might actually been higher taxes in the long run.
Mayer – This has been the problem for the last 30 years because Ohio continues to spend more and more and more, and this is where we get into problems. Because of that higher spending, on the net, taxes have had to go up in Ohio. We went from 30 years ago as one of the low tax states to now one of the high tax states. And yes, it’s good that there are going to be some tax cuts but as you know, the tax cuts are revenue projected and they are raising taxes elsewhere to help pay for those. And it’s like it’s a tax cut without tax increases elsewhere so it’s not a perfect tax cut in our world and as you know local taxes have been going up because of some of the cuts that happened in the last budget cycle and we expect more taxes to go up at the local level so on the whole, we have a real concern about whether this is going to be a net tax cut for Joe and Jane Ohioan.
Mayer says he’s disappointed that Republicans who were elected to office to reduce the deficit have not done that in this budget. He says this budget depends on Ohioans spending money. And if they don’t spend enough, Mayer says the state could be dealing with hard choices in the future.
Governor Kasich and other state leaders say these tax cuts are targeted in a way that small businesses will be able to create more jobs in Ohio. Kasich says Ohio has a rock solid balanced budget, that Ohioans are benefitting from prosperity and the budget funds programs that help people.