From The Statehouse 2005 No. 20
by Jennifer Garrison
Jun. 28, 2005
From the Statehouse Article 20
This week in Columbus was all about the budget. On Tuesday, June 21st, the Ohio House of Representatives voted 53-46 to pass the Fiscal Years 2006 and 2007 biennium budget, otherwise known as House Bill 66. I voted “no”.
I voted against House Bill 66 for a number of reasons. I believe the people of Ohio are at a breaking point with tax burden. This budget includes the second largest tax increase in Ohio history, a $1.4 billion dollar tax increase. The one cent temporary sales tax ends July 1, 2005. On July 1, 2005, a permanent ½ cent sales tax increase will begin.
Secondly, this bill fails the children of Ohio. This budget does not increase funding for one-third of our school districts. The few school districts that do receive an increase most likely could not tell you why they received an increase. Given inflation, our schools will not be able to provide the same services it did last year.
Under this budget, Ohio’s system of funding schools will remain just as unconstitutional as it was in the last budget. It will result in more levies, more divided communities, and more property taxes. Schools will be placed in the position of choosing between hiking property taxes or cutting services for our children.
In the 11th hour the leadership announced they have $1.3 billion more than anticipated in fiscal years 2005-2007. However, not one dime of the money went to k-12 school funding. Furthermore, this budget eliminated the $2500.00 a year tax deduction for tuition payments.
There were some items I supported in this final conference budget. I was pleased to see Local Government Funds and Local Library Funds were not cut as proposed in the House version. I offered an amendment earlier that would have exempted counties in economic distress from these cuts. Additionally, I worked hard to defeat the proposed 30 percent hike in the kilowatt hour taxes on electricity.
I also supported the elimination of the tangible personal property tax for business. However, in the end, these victories were not enough. Ohio needs a new era of tax fairness. In the future Ohio businesses will be taxed on their gross sales versus their profit. I did not support this change in our business tax structure proposed in the budget, called the Commercial Activities Tax (CAT).
The CAT replaces the corporate franchise tax. The corporate franchise tax code in Ohio did not work because it looked like swiss cheese. The holes in the cheese represent all the loopholes, for certain businesses, carved out with the help of good lobbyists. As a result other businesses paid too much.
The (CAT) was created on Tuesday along with carve outs for certain businesses that do not have to pay the CAT. It will not be long and the CAT will resemble swiss cheese too. Additionally, there are big losers under the CAT. High volume, low profit margin businesses like grocery stores stand to lose big. We need a fair tax structure for all businesses that stimulates our economy.
I voted on a number of other bills this week which I will report on in the coming weeks.
You can reach Jennifer Garrison at her Columbus office at 614-644-8728 or in the district at 740-373-2414 or by e-mail at jennifer@jennifergarrison.com. Her website is www.jennifergarrison.com