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Ohioans Aren't Falling for Kasich's Tax Scheme


Lee Schalk
August 7, 2012

Ohio Governor John Kasich should have scrapped his energy tax proposal by now. I wrote last month that Ohio fell from second place to fourteenth place in attractiveness for energy exploration thanks to the governor’s proposed severance tax hike plan. Really, this came as no surprise. Tax hikes on a promising industry are a surefire way to hamper economic growth and cause investors to run for the hills.

Now, it’s not just oil and gas executives who are up in arms over Governor Kasich’s tax scheme. Ohioans clearly have a deep understanding of how higher taxes would impact them. According to this recently released battleground survey, 72 percent of Ohioans believe that higher taxes on the energy industry will be passed on to them, 40 percent think job creation in Ohio will be hindered, and 49 percent feel that government spending should be slashed to pay for a state income tax cut. That’s a lot of angry taxpayers. Hate to say it governor, but you really should have seen this one coming.

In the words of our good friend Matt Mayer, “Ohioans just don’t support tax hikes on small business energy entrepreneurs, farmers, and landowners. There is a better way to provide tax relief to all Ohioans.” The 13,500 Ohio members of the National Taxpayers Union wholeheartedly agree. Our simple suggestion is this: trim back wasteful spending and reduce the burden of government! Consider the following numbers from NTU Vice President Andrew Moylan’s June 5th letter to Governor Kasich:

In 1990, general fund expenditures for Ohio stood at just under $11.6 billion. By 2009, they had grown to roughly $27 billion, an increase of 131 percent. Even adjusting for inflation, Ohio’s budget swelled by a staggering 41 percent. If Ohio’s political leaders simply had restrained spending to annual inflation plus population growth over that period, Ohio’s general expenditures in 2009 would have been roughly $7.5 billion less. By comparison, in Fiscal Year 2010, total state and local individual income tax collections amounted to $7.88 billion.

It’s painfully obvious that modest spending restraint in recent years would have allowed for a near complete elimination of the state income tax. Keeping these figures in mind, Governor Kasich should inject some common sense into his tax plan by pairing state income tax cuts with reductions to spending. The people of the Buckeye State are too smart to fall for the governor’s tax proposal as it currently stands.

Once again, don’t hesitate to pick up a copy of Matt Mayer’s Taxpayers Don’t Stance a Chance: Why Battleground Ohio Loses No Matter Who Wins (And What To Do About It) if you’re interested in Ohio politics.


 

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