Richest 1% of Ohioans pay $51,000 less a year in state taxes since 2005
Posted February 10, 2022 in Press Releases
The richest 1% of Ohioans contribute an average of nearly $51,000 per year less in state tax revenue than they did 17 years ago, according to a new report by Policy Matters Ohio and the Institute on Taxation and Economic Policy (ITEP). Since 2005, many state legislators and governors pushed corporate and income tax cuts and expanded special interest giveaways. The result has been an annual loss of $8 billion in revenue and an upside-down tax code that forces the Ohioans who are paid the least to pay the highest share of their incomes in state taxes.
“Taxes are how the people of Ohio contribute to the betterment of their communities,” said report author, Guillermo Bervejillo, Ph.D. “But some policymakers have manipulated our state tax code to fill the pockets of their wealthiest donors and to coddle big corporations.”
Not only are the wealthiest paying less, the report shows that on average, the 60% of tax filers with lowest incomes pay higher taxes than they did before 2005. This is particularly worrisome for Ohioans of color who, because of the enduring legacy of racialized oppression, are disproportionately represented in the state’s poorest quintiles. According to ITEP data described in an earlier report, roughly 75% of Hispanic Ohioans and 79% of African Americans are in the 60% of Ohio households with the lowest incomes, while the number for white Ohioans is about 56%. This means that Ohioans of color are significantly more likely to pay a higher share of their incomes in taxes because of recent changes to the state’s tax code, while white Ohioans are more likely to be affluent and have benefited.
The report shows that since 2005, 76% of the total value of all personal income tax cuts has gone to the wealthiest 20% of Ohio households; 31% to the richest 1%. The richest 20% of Ohio’s households received an average tax cut exceeding $5,800. Meanwhile, policymakers have shifted the tax code to rely more heavily on sales, excise, and business taxes, which on average increased for 99% of households. The 20% of Ohioans with the lowest incomes now pay an average of $164 more a year in overall state taxes than they did 17 years ago.
“Everyday Ohioans can bear no more of this type of tax legislation,” Bervejillo said. “There is enough wealth in our state for every community to have great schools, quality health care, well-run public transit systems, and safe roads and bridges. Instead, we are being dragged down by supporting the profits of a small number of wealthy individuals and corporations. It is time for elected representatives to ensure that the wealthy and corporations pay what they truly owe.”