In December 2016, the Ohio General Assembly passed a bill forcing it to look at all of the state’s 129 tax loopholes and to decide whether to kill, keep or modify each.
The committee charged with that duty has met just once – over six months ago. But next week, the Joint Tax Expenditure Review Committee will meet for the second time. On the April 11 meeting’s agenda are five sales tax exemptions. They include exemptions for churches and nonprofits, state and local governments and tangible personal property – such as computers, machinery and equipment – used in manufacturing, according to Wednesday’s Capitol Letter, cleveland.com’s daily Statehouse briefing.
Supporters and opponents of each exemption will testify before the bipartisan committee, composed of six lawmakers from each chamber and Ohio Tax Commissioner Joe Testa.
Ohio’s tax expenditures, deductions and credits total over $9 billion a year, said Wendy Patton, who has studied many of the tax breaks for left-leaning Policy Matters Ohio.
For perspective, the state’s current two-year budget is roughly $133 billion.
It’s unclear, given the pace at which the committee is meeting, whether it will get through all the tax breaks by the end of the year, when many lawmakers will leave the General Assembly for a new crop of legislators. Patton said she wishes the committee was further along in the review.
Committee chair Sen. Scott Oelslager, a North Canton Republican, has also scheduled hearings for April 25 and May 9. John Fortney, spokesman for the Republican majority in the Senate, said additional meetings can be scheduled if needed.
Patton said she wishes the committee would have ordered its nonpartisan staff to research why each tax benefit was created and whether it is achieving its original goal. That’s how other states undertake such reviews, she said.
“How can lawmakers make an educated decision if they don’t have a trend line analysis of this?” she said. “That’s our concern.”
Fortney, the GOP spokesman, said the committee will recommend legislation to address any duplicative or contradictory tax laws. And if it chooses to end a tax break, the staff will analyze a bill’s fiscal impacts.
While the committee’s staff isn’t doing a lot of research before the hearing, it will learn about the tax benefits through testimony and information from Testa, the tax commissioner, he said.