COLUMBUS, Ohio — Senate President Matt Huffman and Finance Chair Senator Matt Dolan introduced a finalized version of the Ohio Senate’s operating budget.
It comes weeks after the Ohio House finalized their version, and less than a month before Gov. Mike DeWine needs to sign it into law.
The budget is lengthy and provides insight into various sectors around the state. Education and taxes are the two biggest focus points for Senate Republicans. Their plan includes universal education vouchers and appointing a cabinet member instead of the Board of Education’s superintendent to oversee the Ohio Department of Education.
The budget also includes new numbers for the school funding formula. Vouchers and changing authority to oversee K-12 education are part of a statewide legislation called Senate Bill 1. This legislation passed the Senate in March, and is having hearings in the Ohio House.
The vouchers would be able available to families earning close to 450% of the federal poverty level. It would lower the amount for people who are earning higher incomes. Under this plan, the minimum amount a student could earn with a voucher is 10%.
Republican lawmakers have placed a high priority on eliminating the state’s income tax. This plan breaks Ohioans into two tax brackets. It preserves the middle backet and eliminates the top bracket, and lowers the state’s marginal rate. It would leave Ohio with two flat rates of 2.75% and 3.5%.
Ohioans earning more than $92,000 per year would have an income tax rate of 3.5%. Below that mark, it would drop to 2.75% except for people who earn below $26,500. The people in this bracket would not have to pay income taxes at all. Additionally, the plan phases in a 25% reduction in commercial activity tax rates and minimums over a two-year period.
The plan would also create a two-week tax holiday in August 2024 where any tangible goods under $500 would be tax free.
“While the taxpayer will enjoy a full sales tax credit,” said State Senator Matt Dolan, (R-Chagrin Falls). “We will reimburse the locals for their portion of sales tax transit systems. Anything other than the state tax will be reimbursed.”
This new expanded sales tax holiday will replace the existing back-to-school sales tax holiday only in years when there’s more than $50 million in excess general revenue fund.
“We’re not supportive of we think regressive taxes, income taxes are based on your ability to pay is a better way to receive revenues,” said State Senator Vernon Sykes, (D-Akron). “But again, we need to look at the total package and burden and how it may be shifting one way or the other.”
This budget will also completely fund DeWine’s plan to increase childhood literacy. In the governor’s proposed budget, the literacy plan could cost $162 million over the next two years.
