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House Ways & Means discusses muni tax fixes, tax amnesty

Written on May 6, 2021

OSCPA staff report 

The Ohio House Ways & Means Committee this week added two amendments to a bill addressing issues with municipal net profits taxes. 

The amendments to House Bill 228 would: 

  • Require the Ohio Department of Taxation to pay a municipality its withheld net profits tax revenue once the municipality complies with reporting requirements.
  • Allow pass-through entities to deduct pensions or benefits paid to retirees, for municipal tax purposes.

Both amendments passed without objection May 4 in what was the bill’s third hearing. No testimony was provided. The Ohio Society of CPAs offered proponent testimony for the bill last month

Also, at the May 4 House Ways & Means Committee hearing, Reps. Thomas West, D-Canton, and Bill Roemer, R-Richfield, provided sponsor testimony for a temporary, pandemic-related tax amnesty program. 

HB45 would create a temporary amnesty program, which would waive any interest or penalties that have accrued on delinquent taxes and fees so long as individuals and businesses pay the original amount of those taxes and fees while the program is in effect,” West said. “The goals of this legislation are twofold – to generate some extra revenue for the state, and to provide economic relief for individual Ohioans and for businesses that have lost revenue since the onset of this pandemic.” 

Ohio has conducted four similar programs since 2000, with the most recent in 2018. 

Roemer said the bill contains a $250,000 appropriation to support the Ohio Department of Taxation’s administration and advertisement of the program. “We do recognize the need for the dates of administration to be changed now that we are in May – the bill initially called for a timeline of April 1 to May 31,” he said. “We plan to get feedback from the department on what timeline would work best for them at this stage.” 

“As the state’s vaccine rollout continues and as emergency funding continues to come from the federal level, we feel that HB45 is another way in which we can generate some extra relief for both individuals and businesses at a time they could certainly use it,” Roemer said. 

Hannah News Service contributed to this report.