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Municipal income tax change debated

Supporters and opponents of a statewide income tax uniformity bill discussed the pros and cons of the proposal Friday.

About 50 Greater Springfield Chamber of Commerce members and guests at a luncheon listened to Ohio Chamber of Commerce Vice President Dan Navin and Dayton City Manager Tim Riordan discuss House Bill 5, which would make tax definitions, rules and regulations uniform across Ohio.

Springfield city commissioners recently passed a resolution strongly opposing the bill, which was introduced in the Statehouse last month.

The proposal, which would create uniform municipal income tax procedures across Ohio, but not increase tax rates, could cost the city of Springfield about $618,000 in revenue per year.

Currently, Ohio is the only state which allows its 600 municipalities to set their own rules and regulations, Navin said. A supporter of the issue, he said the current rules are “the most complicated municipal income tax system in the country.”

Uniform tax regulations would allow for more economic growth in Ohio, Navin said, as well as less paperwork, better compliance and more jobs for businesses.

“For some businesses to prepare and file their taxes in some locations, the cost to file a return is often more than the tax owned,” Navin said.

Riordan said municipalities believe income tax rules should be uniform, but it needs to be done in a way that’s revenue neutral.

Last year, 33 cities in seven counties — including Springfield and New Carlisle — signed resolutions supporting the Southwest Ohio Uniform Income Tax proposal, which would have provided a uniform but revenue-neutral option. That group is working on a new proposal that’s also revenue-neutral.

The state already has imposed funding cuts to local governments, Riordan said, and HB 5 would result in more paperwork and more lost money for cities.

“Quite frankly, we hope you would oppose HB 5, if not that, we wish you wouldn’t do anything until you get a chance to see the whole picture,” Riordan said.

Chamber President and CEO Mike McDorman said the issue will be important to the community moving forward, especially given how it could affect both businesses and local government.

“We have to balance that as a business community as we seek to move forward as a greater Springfield community,” McDorman said.

Jim Lagos, the small business and legislative leader for the chamber, called it a topic of critical importance to the community. He said it was the first time two of the leading experts in the state on tax uniformity have come together to discuss the issue publicly.

“This is a rare opportunity,” Lagos said. “We’re going to the sources and finding out what it’s all about from the horse’s mouth.”

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