Proposals to change Ohio's tax system have split segments of the state business community at a time of unprecedented pressure to update the system.

Gov. Bob Taft's plan would lower many Ohioan's income taxes, slash the taxes paid by businesses, then expand a new, low business tax to more types of companies.

It also would eliminate a tax on companies' equipment and inventory. People on all sides of the debate agree that tax needs to be go because it hurts companies trying to expand.

But that tax also provides $1.8 billion for local government services each year, including schools. The split in the business community arises over Taft's proposal to replace that money with the new, low tax of 0.26 percent compared to 8.5 percent.

Taft's plan is backed by manufacturers, farmers and the Ohio Business Roundtable, a group of chief executives of large Ohio firms.

It's opposed by the Ohio Chamber of Commerce and the Ohio Council of Retail Merchants, who worry that companies with low profit margins would be hurt since the new tax would be applied to sales regardless of profits.

They want to modify the current corporate tax and keep part or all of a temporary penny sales tax that expires in July.

The effect the new tax would have is still being debated, and the business groups that are split over the proposal ''are reflecting some confusion on the part of their membership,'' said Edward Hill, a Cleveland State University economist.

Taft proposed a different updating of Ohio's tax system two years ago, but the proposal was dead almost before his news conference announcing the plan was over.

Instead, lawmakers peeved that they weren't consulted enough enacted the temporary sales tax increase and then tried unsuccessfully for the next 18 months to craft their own plan.

Taft, a Republican, learned from his mistakes, acknowledging he hadn't collaborated enough with lawmakers in 2003. This year, Taft and legislative leaders are so far unanimous in backing a single plan.

Any tax proposal will always include a list of winners and losers, said David Adler, a corporate tax policy expert with Deloitte Tax LLP in Columbus.

''There's probably membership in each of the groups that sees pros in each plan, there's probably membership in some of the groups that see detriments to the plan,'' Adler said.

Taft downplays talk of a division, pointing out through his lieutenant governor that both sides agree on about 85 percent of the plan.

But Lt. Gov. Bruce Johnson shows little patience with the chamber's position, saying businesses always oppose tax plans that are successful in raising money.

The chamber is quick to applaud Taft's goals while keeping its opposition alive and pooh-poohing talk of a divided business community.

''We're just responding to the concerns that have been expressed by our members in overwhelming consensus that they wanted to put forward this alternative approach,'' said Dan Navin, the chamber's tax policy director. ''I can't control what people perceive.''

The Business Roundtable says the money lost by eliminating the equipment tax must be replaced, and the governor's plan is the responsible approach.

''We stand up for what the right thing is to do,'' said President Richard Stoff. ''Members come and go - you have to stand up for what you think is right.''

Hill, of Cleveland State, said in five years of working on state tax policy he's never seen so many people united in their belief that major change is needed.

But with that belief comes a need, also unusual, for hard evidence to back a position, he said.

''This debate is not a fact-free exercise any more,'' Hill said. ''There's an incredible burden on anyone who wants to enter this discussion to enter on the basis of fact and not on the basis of ideology.''

Andrew Welsh-Huggins is the statehouse correspondent for the Ohio Associated Press' Columbus bureau.