By Dennis Hetzel, Executive Director
We have taken part in about 20 meetings with members of the Ohio House and Ohio Senate in the past two weeks. We have yet to meet a legislator who thinks it’s smart to levy a sales tax on advertising.
Obviously, that is a good sign, and there is growing evidence that the idea of vastly expanding the sales tax to nearly all services in Ohio will not be in the state budget when the plan moves from the House to the Senate sometime in April.
So, why aren’t we relaxing? Why am I urging ONA members to continue to make contact with legislators while they are back in their districts on recess during the next two weeks?
Put simply, the issue is not going away. Some aspects of sales tax expansion could land in the final budget. More broadly, Republican leaders in particular see expanding the base of consumption taxation (e.g., sales taxes) as a far-smarter way to spur economic development and generate revenue than through income taxes. Some would like to completely eliminate the state income tax to make Ohio more like Florida and Texas, neither of which has an income tax.
You can agree or disagree with that proposition, but expansion of the sales tax base will be an important policy discussion for many months to come.
That is why we must communicate effectively that an advertising sales tax will not bring economic growth or new jobs to Ohio. It will do the opposite and be impossible to administer fairly.
The Ohio Chamber of Commerce came out against the sales tax expansion this week, which is quite helpful. If your local Chamber has not taken a stand, you should urge them to do so.
We recently asked members in a survey to assess the impact that the governor’s budget plan would have on their operations. The answers we have received are chilling. The impact could devastate some of our newspapers and their abilities to serve their communities.
Supporters keep saying that you have to consider the whole package, weighing the sales tax expansion versus cuts in the state income tax and a new tax break for small business. We asked our members to do that. The responses were loud and clear that it’s not a trade any Ohio newspaper executive wants to make, including those publishers whose papers are legally structured to benefit from the tax break for businesses in which income passes through to personal returns.
This is an excellent time to meet with your state representatives and state senators on their home turf to talk to them about our concerns with the sales tax expansion. They need to keep hearing from the grass roots. If you need contact info, additional talking points or other materials, just let us know. Our coalition website, www.noadtax.com, is a great resource.
Our “No Ad Tax” coalition also is growing – media members include newspapers, broadcasters, cable television, advertising agency groups and the outdoor advertising industry. The Ohio Grocers and Ohio Auto Dealer associations have joined, and there is another, broader coalition that includes many others.
Please keep up the pressure.
Additional Coverage
- Ohio Chamber of Commerce testifies against Kasich’s tax plan (From The Plain Dealer)
- Ohio Advertising Tax Coalition testifies that ad tax will damage Ohio’s economy (From press release by PR Newswire)
- Minnesota Governor Backs Down as Coalition Rallies Against Proposed Ad Taxes (From Ad Age)
- Editorial: Sales tax all but dead (From the Akron Beacon Journal)
- Ad tax update: ONA hires lobbyists, seeks member contributions (by Dennis Hetzel, ONA)
- Editorial: Sales tax exemptions unjustified (from the Columbus Dispatch)
- Editorial: Plan to expand sales tax isn’t workable (from the Toledo Blade)
