Senator Mumper

Naturally, during the month of April, one of the biggest things on Ohioans', and all Americans' minds is taxes.  We spend the days and weeks before April 15 preparing our paperwork, fretting about our payments and scrutinizing the tax rates.  While dealing with taxes is a stressful responsibility, once April has passed, the thought of tax time is replaced by other, more pleasant ideas.

Recently, the Ohio Business Roundtable (OBR) brought the issue of Ohio taxes to the forefront once gain with its report Ohio Tax Reform:  Year 2 in Review.   Yet, this report communicates good news about our state's tax climate, as it outlines the economic success Ohio has enjoyed, in addition to the bright future we can look forward to.  This is a result of the programs created through the diligent work and collaboration among state leaders, legislators and private sector business experts.

The OBR report begins by reviewing the comprehensive tax reform, which the General Assembly passed in 2005.  Under this legislation, which is revamping the state's tax structure, Ohio taxpayers have been enjoying an annual 4.2 percent cut on their income taxes.  By the year 2010, this will add up to a total 21 percent or approximately $10.6 billion reduction in personal income taxes.

Also, this sweeping tax reform is in the process of eliminating both the Corporate Franchise Tax and the state's personal property tax on businesses' inventory, machinery, equipment, furniture and fixtures.  Instead, the state is implementing a fairer, simpler tax structure with the Commercial Activities Tax (CAT).  This broad-based, low-rate tax creates a more level playing field for all Ohio businesses and, along with the aforementioned tax cuts, should decrease businesses' operating costs.

According to the OBR, these tax reforms are very advantageous for Ohio, and it is predicted that they will translate to increases of $5.6 billion in gross state product, $3.6 billion in personal finances and $6.3 billion in capital investments for the state.  Moreover, Ohio's new tax structure will shrink labor and operating costs, attract and maintain a talented workforce and ultimately help bolster businesses' productivity and allow them to maximize their profits.

Although the 2005 tax reform package is being phased-in over a period of five years, Ohio has already begun to reap its benefits.  For example, Ohio companies initiated more than $7 billion worth of new private investment projects, which is significantly more than the $5.9 billion in 2006.  In addition, the Federation of Tax Administrators recently reported that the ranking of Ohio's per capita state tax burden has dropped from 27^th to 38^th in the nation.

The successes in Ohio's tax and business environments culminated in the receipt of Site Selection Magazine's 2007 Governor's Cup.  This award is granted to the state that leads the nation in the number of new and expanded business facilities.  And, with nearly 400 new projects in the works, Ohio has surpassed neighboring states like Illinois and Michigan to win the Governor's Cup for the second year in a row.  In fact, Ohioans can be proud that our state has achieved this honor six times overall.

While taxes are always a weight on one's mind and budget, especially in the trying economic times we are currently experiencing, the OBR's recent report should be a message for Ohioans to take heart.  State leaders are dedicated to finding ways to improve our constituents' quality of life, and with the passage of the state tax reform, as well as earning national recognition and awards for economic improvement, Ohio is proving that it is on a path to success.