Tax Reform: Keep More of Your Profit by Doing Business in Ohio
Elimination of taxes on machinery and equipment, rock-bottom rates on gross receipts, tax exemption on the first million in revenues, and reduction in personal income tax combine to make the Buckeye State more business friendly.
Large, small, or somewhere in between, today's businesses are generally competing in a global marketplace where even small advantages can make a big difference in profitability—sometimes even survival. That's exactly what the State of Ohio had in mind when it undertook an expansive restructuring of its business tax policy in 2005. The changes that have been phased in during the past five years as a result of H.B. 66 were expressly designed to make the Buckeye State a more attractive location in which to start and run a business. As a result, 'The cost of running a business in Ohio today is significantly less than it was in 2005,' says Thomas M. Zaino, JD, CPA, member in charge of the Columbus office of the McDonald Hopkins LLC law firm and a former Ohio Tax Commissioner from 1999 to 2003.
The most notable changes from the perspective of a business owner or someone thinking of locating a business in Ohio include the elimination of two very burdensome business taxes—the corporation franchise tax and the tangible personal property tax, says Zaino, who worked with the Ohio Business Roundtable and individual businesses to develop the 2005 tax reform. Another important change is a 16.8% reduction in the personal income tax, which is scheduled to grow into a 21% reduction for 2011.
