House Passes Major Tax Changes on Business Income Tax Deduction
Of concern to many OTAA members is the proposed decrease in the small business income tax deduction from $250,000 to $100,000 that was included in the House-passed version of the bill. The House did, however, eliminate the income tax on personal income below $22,250 and provide for a 6.6% reduction in every other tax bracket. Despite this across-the-board rate reduction, a late addition to the bill that proposes to eliminate the current 3% rate cap on business income above $250,000, allowing for a top rate of 4.667% on income above $100,000, is a concern to a large portion of our membership. Along with numerous other business associations, we will be sharing the concerns of our pass-through entity member companies with legislators in the Senate.
Burdensome Reimbursement Insurance Provision a Step Closer to Removal
OTAA was successful in convincing the House to remove a burdensome statute via the budget bill that was negatively impacting our auto repair and tire dealer members. Since 2006, state law has required auto repair shops and tire dealers who offer extended warranties on wheel, tire, and road hazard service contracts to carry a reimbursement insurance policy, essentially "back-up" insurance. Retailers have long offered extended warranties without issue and maintain the financial wherewithal to fulfill their contractual obligations when claims are made. The Council believes the reimbursement insurance requirement is a nonsensical mandate and places an undue burden on businesses.
All legislation text, analysis and supporting documents can be found here: http://www.ohiohouse.gov/legislation/legislative-tools
If you have any questions or would like to provide feedback please contact Alex Boehnke, Legislative Director at AlexB@ohioretailmerchants.com