A proposal to create a uniform set of rules and regulations for all cities in Ohio that impose income taxes has officials in some municipalities worried.
The measure, House Bill 601, would establish one set of rules for withholding and taxation among all cities and villages in Ohio.
That may not seem like a big deal to most readers. Tiffin's income tax form, for example, isn't stone simple. But the form and its instructions are just two pages long.
But for employers that have businesses in multiple Ohio cities, or contractors who send crews to work in a variety of locales, complying with local income taxes can be a challenge. And the cost of compliance can exceed the amount of tax paid.
Care must be taken, however, to ensure the impact of HB 601 would be revenue-neutral. Local governments already are reeling from the loss of estate taxes and cuts in state funding. Some city managers have previewed the impact of the current bill's provisions and calculated another substantial loss in revenue.
State legislators should keep that in mind when considering HB 601. If it can be amended to eliminate, or at least minimize, the economic impact on taxing municipalities, lawmakers should change the bill. If not, the state should be willing to make up for funding lost by municipalities.
