Report of the Committee to Study State and Local Taxes - Ohio ...

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Corporation Franchise Tax: Overview • One of the older state taxes (1902) • Originally a tax on wealth; income element added in 1972; tax on net worth capped at $150,000 in 1999 • Conceptual origin as a “privilege” tax Corporation Franchise Tax: Overview Fiscal Year 2002 Revenue --$774.4 million • Tax Base: Two alternative bases – net worth and net income (taxpayer calculates both and pays higher of the two) • Tax Rates: – Net worth: 4.00 mills (0.4%) on the taxable value of the corporation, $150,000 maximum liability – Net income: 5.1% on first $50,000 of Ohio taxable income + 8.5% on Ohio taxable income in excess of $50,000 41
Corporation Franchise Tax: Overview • Who Pays: For profit corporations doing business in Ohio • How Collected: Three estimated tax payments and annual return • Who Administers: ODT Corporation Franchise Tax: Definition of Tax Base • Net Worth: Net value of stock (excluding pollution control facilities and similar facilities) X apportionment formula = Ohio taxable value • Net Income: Begins with federal taxable income; then calculations done to reflect the amount of federal taxable income that should be allocated and apportioned to Ohio 42
Page 1: REPORT OF THE COMMITTEE TO STUDY ST
Page 6 and 7: I. Introduction This document const
Page 8 and 9: August 27, 2002 Recommendations an
Page 10 and 11: November 26, 2002 Testimony on beh
Page 12 and 13: III. Basic Overview of Ohio’s Tax
Page 14 and 15: Township 2% County 8% Municipal 13%
Page 16 and 17: State/Local Profile: “Business”
Page 18 and 19: Other Taxes 9% Motor Vehicle Licens
Page 20 and 21: State Aid 42% School District Profi
Page 22 and 23: County Profile: Taxes Levied • Pr
Page 24 and 25: Profile: Review • Income and sale
Page 26 and 27: Overview: State Income Tax • Begi
Page 28 and 29: This slide is intentionally blank.
Page 30 and 31: Overview: Municipal Income Tax •
Page 32 and 33: Overview: Property Taxes By Propert
Page 34 and 35: Real Property Tax-Brief History •
Page 36 and 37: Tangible Property Tax-Brief History
Page 38 and 39: Public Utility and Business Tangibl
Page 40 and 41: Sales and Use Tax: Overview • Ena
Page 42 and 43: Sales & Use Tax: What is the Use Ta
Page 44 and 45: Sales and Use Tax - County and Tran
Page 48 and 49: Corporation Franchise Tax: Definiti
Page 50 and 51: Details: Corporate Tax Historical S
Page 52 and 53: Motor Vehicle Fuel Tax: Overview Fi
Page 54 and 55: IV. Comparison of Ohio’s Tax Syst
Page 56 and 57: Pennsylvania and Illinois to Ohio,
Page 58 and 59: 4.0% 3.5% 3.0% 2.5% 2.0% 1.5% 1.0%
Page 60 and 61: Property Taxes (Real Property and T
Page 62 and 63: Agriculture property is fully taxab
Page 64 and 65: $2,000 $1,800 $1,600 $1,400 $1,200
Page 66 and 67: $400 $350 $300 $250 $200 $150 $100
Page 68 and 69: Conclusion At least three primary a
Page 70 and 71: As services, which tend to be tax e
Page 72 and 73: VI. Economic Development Considerat
Page 74 and 75: since 1998 - two years before the e
Page 76 and 77: customers, suppliers, infrastructur
Page 78 and 79: makes payments to out-of-state rela
Page 80 and 81: Maximum Corporate Income Tax Rates
Page 82 and 83: often referred to as “no-where”
Page 84 and 85: Stability: The personal income tax
Page 86 and 87: PERSONAL INCOME TAX OPTIONS To over
Page 88 and 89: While these alternatives would not
Page 90 and 91: SALES & USE TAX OBSTACLES Simplicit
Page 92 and 93: State State Sales And Use Tax State
Page 94 and 95: 4. Do Not Increase the County Permi
Page 96 and 97:
. A simple tax base consisting sole
Page 98 and 99:
Closely tied to stability is the im
Page 100 and 101:
ownership of the inventory to a non
Page 102 and 103:
entities, they do have some taxatio
Page 104 and 105:
OPTIONS RELATED TO TAX ADMINISTRATI
Page 106:
APPENDIX A Member Letters 101
Page 110 and 111:
property tax will cost local govern
Page 117 and 118:
APPENDIX C A Comparison of the Busi
Page 119 and 120:
Example #1: Facts: An Ohio company
Page 121 and 122:
APPENDIX D Combined and Consolidate
Page 123 and 124:
Example: Under this method of filin
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Report of the Committee to Study State and Local Taxes - Ohio ...

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