Ohio Supreme Court to hear muni tax reform arguments May 13

OSCPA staff report

The Ohio Supreme Court will take up the issue of municipal net profits tax reform on May 13, when justices will hear arguments in two related cases.

Because of social distancing guidelines, the session will be held via videoconference and streamed on May 13 at 9 a.m. on The Ohio Channel.

Cities in 2019 filed  an appeal that seeks to overturn an earlier appeals court ruling upholding OSCPA-supported reforms in 2014’s House Bill 5, and in 2017 law changes eliminating sales throwback and a centralized filing and payment option for the municipal net profits tax. The Supreme Court on Aug. 6  granted jurisdiction to hear the appeals on the cities’ assertion that the laws violate the “Home Rule” provision of Ohio’s constitution.

But Ohio’s archaic municipal net profits tax system costs businesses more to comply than cities make in revenue, OSCPA wrote in November in amicus briefs filed in the two  separate cases before the Ohio high court.

OSCPA leads the Municipal Tax Reform Coalition, a broad partnership of statewide organizations driving reform of Ohio’s municipal income tax code. The group argues that centralized administration of the net profit portion of the municipal income tax would save taxpayers as much as $800 million per year, but the provision itself only nets cities $750 million annually.

OSCPA Tax Policy Director Greg Saul, Esq., CAE, said a decision is likely to be rendered in autumn 2020. He added he remains confident the laws are constitutional.

For more information on this important issue, contact the OSCPA  government relations team.

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