Senate Says Goodbye to Kasich’s Income Tax Cut

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State senators in Ohio are pulling what's left of Republican Gov. John Kasich's proposed income-tax cut from the state budget for now in favor of tax relief targeted at small businesses.

The Tuesday move by the GOP-led Ohio Senate's Finance Committee comes as a blow to Kasich, who pledged to reduce Ohio's statewide income tax if elected.

The Ohio House had retained 7 percent of the 20 percent permanent income-tax cut originally proposed by Kasich.

The Senate instead restored a small-business benefit also proposed by Kasich, which allows individuals to deduct up to $375,000 in net annual business income for income tax purposes.

Leaders said debate on income-tax breaks will continue.

The Senate tax plan is worth roughly $1.4 billion, compared with about $1.5 billion for the House plan.

Highlights of changes made Tuesday to the Ohio Senate's version of the state's two-year budget:

  • TAXES: Delivers $1.4 billion targeted tax cut to small businesses by exempting individuals' first $375,000 of annual business income from the state income tax. Removes a 7 percent permanent income-tax cut statewide worth $1.5 billion.  
  • STUDENT VOTERS: Removes a provision requiring Ohio universities to charge lower in-state tuition to out-of-state students who request the documents necessary to register to vote in the state.  
  • E-SCHOOL FITNESS: Exempts students at online schools from meeting the state physical education requirement to graduate. 
  • LICENSE PLATES: Establishes a History License Plate program whose proceeds would fund state historical grants. Creates an Ohio coal license plate.
  • SCHOOL BUSING: Eliminates a provision that prohibited school districts from using public transit buses for transporting K-5 students.
  • COSMETOLOGY COMPLAINTS: Establishes a complaint process at the State Board of Cosmetology in which students and former students of a school of cosmetology could file allegations of possible law violations.
  • LIQUOR DEFINITIONS: Revises the definitions of "intoxicating liquor" and "mixed beverages" to allow the Department of Liquor Control to regulate food substances, such as chocolate, containing alcohol.
  • SPEED LIMITS: Expands the roadways that allow 70 mph and 60 mph speed limits, so long as they were built to the standards and specifications of interstate highways.
  • SPIDER MONKEYS: Removes spider monkeys from the list of animals regulated under Ohio's recently passed exotic animal law.
  • POLITICAL DISCLAIMERS: Eliminates a requirement that candidate or legislative campaign funds disclose on political publications the home or business address of the candidate or the committee chair, treasurer or secretary.
  • HISTORICAL LANDMARKS: Repeals state law requiring the Ohio Historical Society to maintain state registries of archaeological and historic landmarks. Exempts the society from exceeding certain annual purchase maximums. Removes a restriction on permitting a new construction and debris facility within 500 feet of land listed on the state historic landmark registry.