Staff photo April 2014

by Policy Matters Ohio on August 29th, 2014

Front row, left to right: Shanelle Smith, Kalitha Williams, Amanda Woodrum, Michael Shields.  Second row: Pam Rosado, Amy Hanauer, Wendy Patton.  Third row: Zach Schiller, Ruth Clevenger, Piet van Lier.

Staff photo April 2012.

Out-of-step

by Policy Matters Ohio on August 26th, 2014
Fore immediate release
Contact: Hannah Halbert, 614.221.4505
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Full report

 

More needed to make the Ohio EITC a credit that counts

The majority of Ohio’s poorest workers will see no benefit from the recent expansion of the Ohio Earned Income Tax Credit (EITC). The Ohio General Assembly doubled the value of the state EITC, expanding the credit from 5 to 10 percent of the federal credit. Based on an analysis by Institute on Taxation and Economic Policy (ITEP) only 3 percent of tax filers earning less than $19,000 will see any tax savings from the expansion. For the small number in this group that will benefit the average additional annual income tax savings is just $5.

“The EITC is intended to encourage work, help keep working families out of poverty, and help make up for the fact that low-income people pay more of their income in taxes than their wealthier counterparts do,” said Hannah Halbert, report author and researcher with Policy Matters Ohio. “Despite this change, the credit is too weak to reach many of the people it is intended to help.”

The Ohio EITC remains out of step with nearly all other state EITCs, as the federal EITC and nearly all state EITCs are fully refundable. Ohio’s credit is nonrefundable, meaning the credit can only reduce tax liability. It is also capped, so that the maximum EITC that a filer with Ohio Taxable Income greater than $20,000 may receive is half of the tax that is due after certain exemptions. Even with the recent expansion, it is below the average value of other state refundable credits (16 percent of the U.S. credit) and remains one of the weakest state EITCs in the nation.

“Refundability is the most important design choice facing policymakers because it is the feature that makes the EITC a credit that counts for low-income working people,” said Halbert. “Increasing the value of the credit is a small step toward reforming our EITC, but more is needed to make our credit one that counts for Ohio’s low-income working families.”

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Policy Matters Ohio is a member of the Working Poor Families Project, a national initiative that advances state policies in the areas of education and skills training for adults, economic development, and income and work supports. WPFP supported this research on the EITC.

 

Free Fall

by Policy Matters Ohio on August 25th, 2014

In this eNews: Tax shift a windfall for the rich, others pay more; changes to safety net could push more families into poverty; July job losses wiped out months of gains; Ohio refused work requirement waiver for food aid; and more.

(more…)

New Cuts to Food Aid in Ohio Should Not Go Forward

by Policy Matters Ohio on August 25th, 2014
Policy Matters Ohio, others, call on the Kasich administration to reverse course on a decision that has cost thousands of Ohioans federally funded food aid as they struggle with unemployment and underemployment in the slow recovery.

(more…)

The Great Ohio Tax Shift

by Policy Matters Ohio on August 18th, 2014
For immediate release
Contact: Zach Schiller, 216.361.9801
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Full report

New report finds that changes since 2005 have widened inequality

Major changes in Ohio’s tax system over the past nine years have slashed average annual tax bills for the state’s most affluent 1 percent of taxpayers by more than $20,000, while the bottom three-fifths of state taxpayers as a group are seeing an overall increase.

That is the most significant finding of a report Policy Matters Ohio released today. It is based on an analysis by the Institute on Taxation and Economic Policy, a nonprofit research group in Washington, D.C., with a sophisticated model of the state and local tax system. ITEP examined major tax changes in Ohio since 2005, and how they affected Ohioans last year compared to what tax filers would have paid had the pre-2005 tax system remained in place.

“In effect, lower-income Ohioans are helping to pay for tax cuts for others who earn much more,” said Zach Schiller, Policy Matters Ohio research director and the report’s author. “The $20,000 average annual tax cut for Ohioans in the top 1 percent is greater than the income of those in the bottom fifth.”

The report found that all of the biggest tax changes since 2005, when a major overhaul was approved, have further slanted the state and local tax system in favor of the affluent.

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Policy Matters Ohio is a nonprofit, nonpartisan state policy research institute

with offices in Cleveland and Columbus.

The Great Ohio Tax Shift

by Policy Matters Ohio on August 18th, 2014

Tax overhauls in the past nine years have slashed average tax bills for the top 1 percent by more than $20,000, while the bottom three-fifths pay more as a group. (more…)

Two Steps Back

by Policy Matters Ohio on August 15th, 2014

 12,400 job losses in July eradicated modest recent gains.  6,000 left the labor force.  Unemployment ticked back up to 5.7 percent.

(more…)

The Growing Problem of Payday Lending in Ohio

by Policy Matters Ohio on August 7th, 2014

Policy liaison Kalitha Williams discusses the adverse impact nefarious lenders can have on poor families.

(more…)

A Think Tank With a Shaker Edge

by Policy Matters Ohio on August 1st, 2014
Download article (3pp)

Shaker Life Magazine interviews director Amy Hanauer

 

Read full article.

 

Study finds low wages will challenge budget initiatives on public assistance

by Policy Matters Ohio on July 22nd, 2014
For immediate release
Contact: Wendy Patton: 614.221.4505
Download press release (1pg)
Full report

The Mid-Biennium Review created five initiatives to help public assistance recipients get jobs and reduce reliance on public assistance, detailed in a new report by Policy Matters Ohio.  “The context of these initiatives is a low-wage economy that leaves many working families in poverty, a worrisome increase in deep poverty and a set of public assistance programs that have already been reduced or narrowed,” said Wendy Patton, Senior Project Director and report author. “Outcomes may help struggling families, or hurt,” Patton said.

The report, Public Assistance Initiatives in 2014 Ohio Budget Bill: Will they help Ohio families? finds that a single parent with an infant and a preschooler who works in almost any one of Ohio’s 12 largest occupational groups – like cashier, food service worker, or home health aide – may live in or close to poverty.  The cost of self-sufficiency for a family like this is twice the poverty level or higher in most Ohio counties.  Public assistance helps close the gap between earnings and need for hundreds of thousands of Ohio families. 

Public assistance programs also help to address the rising level of deep poverty, in which families live at half the poverty level or less.  Ohio saw the third largest jump in such poverty among the states between 2000 and 2012.

The report finds that in key programs of public assistance other than health care, caseloads have been reduced and eligibility narrowed. Enrollment in Ohio Works First – cash assistance – has declined by 71.3 percent for adults and by 40.2 percent for children since January 2011, in spite of the increase in deep poverty.  In 2013, Ohio refused a waiver of federal rules for 72 of 88 counties. The waiver would have allowed more adults to receive food aid.  In the fiscal year 2012-13 state budget, the income eligibility level for childcare assistance was lowered from 150 percent of poverty to 125 percent, one of the lowest eligibility levels in the nation.

“The initiatives on public assistance could help families in the low-wage economy, but such outcomes may be elusive,” said Patton. “We have too few good jobs and we have been too quick to slash the safety net that helps families survive in this economy.”

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Policy Matters Ohio is a nonprofit, nonpartisan state policy research institute

with offices in Cleveland and Columbus.