Schiller, Policy Matters Ohio

Zach Schiller: The biggest problem with the budget is conscious state policy. 2005 tax cut cause 2.1 billion deficit per year. Our problem is self-inflicted. Was this done to help the Ohio economy? Didn't work. We see no (or few) benefits from tax cuts. People seem to see a connection between tax levels and economic development...look at the Dakotas - one has the highest and one has nearly the lowest income taxes... and economies are same. Tax structure is much less significant than often suggested. Forty year of state economic performance indicate no correlation between tax levels and economic performance. The share of taxes paid by business has dropped dramatically - from over 40% several decades ago to under 30% - has the roughly $8000 increase that the top 1% earning income people from Ohio (that resulted from the 2005 tax cuts) helped the economy?
We have tax breaks for banks which are much greater than the entire corporate taxes paid by banks.
We have state subsidies for taxes for property taxes... Governors Voinovich and Taft tried to keep these to go only so far... Husted tried... this is not a partisan issue.
We have special breaks for special industries - for breweries, for instance. If they pay taxes early, they get a break. No one knows the purpose. We need to look at these things.
There are 17 different tax breaks for commercial activity taxes. Some are for losses prior to 2005 - you can write that off against commercial activity taxes if you are abig company, not if you are a small tax. These breaks were given under the assumption that companies would pay other taxes (corporate franchise) which they are no longer paying - so why do they get the tax break?

These are just a few examples. These are permanent parts of the tax codes - AZ and WA have sunsets, moratoriums on these breaks, these tax credits - we need to look at this.