Tax break has benefited
Published 9:53 am Wednesday, October 1, 2014
Gov. John Kasich’s tax break for small businesses has performed as promised: It has allowed these risk-takers, who cumulatively are a massive employer and the backbone of the economy, to thrive a bit more.
So far this year, Ohioans have saved an estimated $253 million in taxes under the new small-business tax break, claiming more than $6.3 billion in income deductions. And that number will grow by the Oct. 15 deadline for those given filing extensions.
The tax benefit allows Ohioans to deduct half of their business’ income, up to the first $250,000, on their individual tax returns. Next year, the deduction is to increase to 75 percent of that income.
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“It means these businesses will be able to reinvest … (and) be healthier,” Kasich said last year as the legislature passed a package of tax changes.
Critics said that most businesses would qualify for less than $1,000 — an impact they said was so small that it wouldn’t be enough to create jobs. They branded it a tax cut for the wealthy and said the loss in government revenues, which could fund more services, wouldn’t be worth it.
But for a small-business owner, $1,000 is significant. It can help to repair equipment, advertise the business, buy supplies or add hours for employees.
And more than 85 percent of the 348,600 taxpayers who’ve claimed the deduction had business incomes of $80,000 or less, Northeast Ohio Media Group reports.
These hardly are “wealthy business owners.” Money that stays in the economy and helps businesses thrive will yield additional tax revenue in the long run.
The Columbus Dispatch