Wednesday, August 10, 2011

Guest Column from State Representative Jim Buchy Removing the Chains and Shackles of Taxes in the Budget

Balancing an $8 billion budget was a difficult process, but balancing it without tax increases was something many doubters did not believe could happen. When the budget became law it actually included changes to tax policy that lower taxes and provide opportunities for Ohio’s citizens to pay their back taxes without penalty.

Tax increases stifle the growth of business and put a damper on any chance of economic recovery. The policy changes in this budget will encourage businessmen to invest in their business and create jobs. It will also encourage economic activity in Ohio. The budget eliminated the estate tax, created two tax amnesty periods, and if the state is conducting an audit on individuals or businesses, the state will be responsible to refund any overpayment of tax for the same period they are conducting the audit.

The elimination of the estate tax is aimed at helping families, small businesses, and farmers across Ohio who currently pay this unfair double-tax. The existing law only allowed for the first $338,333to be exempt from taxation. If you include specific exemptions only in place for farmers there could be up to $1.5 million of an estate exempt. In House District 77, farmers who own more than 357 acres of farm land with no buildings, homes, equipment or livestock are subject to the estate tax even with the most exemptions possible for farmers. Only 30 states have an estate tax in place and of those 30, the average exemption is $1.7 million. In Ohio, the tax will not be eliminated until 2013 so that local governments have ample time to prepare for the loss of this revenue source. This elimination is a commonsense move that will provide Ohioans the opportunity to maintain family businesses and pass them from generation to generation without fear of the double-tax that has caused many businesses to change hands.

This general assembly has been focused on bringing jobs to Ohio. The fear of the unknown is often a deterrent to investment. The budget includes two amnesty programs that will allow Ohioans to be sure they have paid all their taxes and it will remove the threat of an audit returning a large tax bill in the future. There will be a three month general amnesty program that welcomes Ohioans to come forward in 2012 to pay back taxes and ensure their tax responsibility is met.

In addition, Senator Faber and I worked closely to get two more features in the budget. A use tax amnesty program and equal look back on audits for citizens and the government, were both the result of two separate calls that came from people in the district. Use tax is a tax on goods that should have been charged sales tax but for whatever reason sales tax was not collected at the time of sale. The Ohio Department of Taxation reports that 96 percent of audits turn up unpaid or underpaid use tax. The potential of future audits on use tax would have hampered economic growth in Ohio’s business sector. An opportunity for amnesty will take place from October 1, 2011 through May 31, 2013. During this period businesses will receive notice from the Ohio Department of Taxation with further details about the opportunity to take part in the amnesty program. If businesses or citizens are subject to an audit in the future, they will be able to receive payment from the government for taxes that they overpaid for the same look-back period as the tax department is auditing them. This is established by a provision of the bill that redefined the look-back period for audits. These commonsense approaches will benefit Ohioans.

I supported Governor Kasich’s budget because it accomplished many of the goals supported by the people who elected the governor and my colleagues. I was also pleased by the way this budget reels in the size of government and promotes business and job growth in Ohio. These changes in the Ohio tax structure, along with other tax changes, will make a huge impact in Ohio moving forward.


  1. "In Ohio, the tax will not be eliminated until 2013 so that local governments have ample time to prepare for the loss of this revenue source."
    Mr. Buchy, how do you suggest the local governments "prepare" for this, by imposing more taxes at the local level??

  2. Or whatever. They could care less in Columbus.

  3. Add the elimination of the Estate Tax to the severe reductions of the Local Government Funds and the exeleration of the phase out of the Personal Property Tax, local governments will have no choice but to impose additional taxes at the local level or shut down services. Local services are the ones that count (e.g. Police, Fire, EMS, street maintenance, etc.).

  4. The old shell-game continues. They spout the political rhetoric of cutting state spending while cutting the throats of the locals that the state is absolutely obligated to help support from committments for past tax increases. The only solution will be for locals to raise local taxes. Nothing will be accomplished but the continued re-election of the dishonest blowhards.

  5. And Senate Bill helped all of this how? Locally, the firefighters union made concessions out of their own pockets to retain two of their own. I didn't see the state or the city helping with that. Perhaps the Governor actually did have an ulterior motive with SB 5. Perhaps it was union busting.

  6. Badge 1 - SB5 had little impact on unions ability to negotiate contracts. What it does do is to give taxpayers a fair deal with
    funding of health care and pensions. It prevents administrators and contracts from hiding costs in lieu of wages and salaries. The schools in particular need to be reeled back in.

    Safety services loss of ability to strike is more of an emotional loss than a real set back.

  7. Unions are no longer needed, like they may have once been. They are crooks. If people who pay union dues had a clue what those dues are actually used for, they would (should) be furious! Union is just another name for Liberal or Bully these days. What a shame.


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