On Monday, February 2, 2015, Governor Kasich released a new budget proposal that would produce an estimated tax savings of $523 million over the next two years. The budget focuses on helping small businesses and shifting tax burdens from income to consumption of goods.
Gov. Kasich described his proposed budget as, “giving people more choice” in how they spend their money.
The proposed budget would cut income taxes by 23 percent, 15 percent in the first year and 8 percent the following year, and increase sales tax, cigarette tax, and large business income tax. The sales tax rate would increase a half cent from 5.75 percent to 6.25 percent. The governor also looks to expand sales tax to previously tax exempt goods and services such as, lobbying, public-relations, management-consulting, debt-collection, cable TV subscriptions, parking and travel services.
Along with tax reform, the budget also highlights other policy initiatives such as, welfare reform, K-12 education, and higher education.
The House is set to begin discussions on the proposed budget immediately. A budget must be approved by June 30, in time for the beginning of the fiscal year, starting July 1.