How Do We Solve the Problem of High Taxes?
People and companies aren’t going to come here or stay here because policymakers dropped the tax rate a small amount.
I get this question. A lot. It involves a three-part answer.
First, the largest tax burden hits us from the federal government. If we want those taxes lowered, we have to get fiscal restraint in Washington, D.C. That starts by reducing our deficit spending and by decentralizing power and money back to the states so states can compete to identify policies that work and ones that don’t. Remember how transformative welfare reform was when states (re)secured the right to compete on policies? It didn’t just save money, it literally saved lives, as people moved from welfare to work and once again had hope and purpose in their lives. Nearly ten years ago as part of my visiting fellowship with The Heritage Foundation I detailed how we could do this in my report, “Competitive Federalism: Leveraging the Constitution to Rebuild America.” Returning power to the states also means the federal government can go back to focusing on its express powers as laid out in the Constitution and stop over-regulating every aspect of our lives—don’t get me started on the leviathan that has become the federal administrative state that I believe is largely unconstitutional and violates our separation of powers.
As governor, I will push back against the leviathan aggressively and build a nationwide movement with other governors and state legislatures to force the federal government to return power back to the states as the U.S. Constitution expressly states. We will force that action via pressure on the congressional delegations and, when necessary, via litigation. My team will constantly look for ideal cases to litigate to put the issue of the 10th Amendment squarely in front of the U.S. Supreme Court. There truly is no better time to litigate the 10th Amendment than with a 5-3 (who knows where Chief Justice John Roberts will be) majority that believes in federalism.
Next, and one of the core reasons I’m exploring a run for governor, we will eliminate the state income tax in Ohio. Had the Kasich and DeWine Administrations along with the supermajority Republican Ohio General Assembly restrained spending to population growth and inflation, Ohio could have eliminated the state income tax by now. Instead, they spent what came in, which is why the latest two-year budget is an $86.1 billion spending behemoth. By eliminating the state income tax, Ohio would be the 10th state to do so and spur an economic boom in Ohio. People and companies aren’t going to come here or stay here because policymakers dropped the tax rate a small amount. They will if they and their workers don’t have to pay a state income tax.
Lastly, even if we can eliminate the state income tax, Ohio’s local tax burden is among the highest in America. With over 2,300 taxing entities, Ohioans get hit at every turn on their income, their property, and their consumption. Many homeowners are beginning to hear about the upcoming property tax reassessments that will result in large property tax hikes. On this one, unlike most politicians who say whatever they think voters want to hear or simply bury their heads in the sand, I don’t have THE answer on how we reduce our combined local tax burden. But, I think a dedicated group of Ohioans can come up with a series of reforms that would result in lowering our local tax burden.
That is why as part of my agenda for Governor, I want to appoint a commission within six months of being sworn in that has one year to develop the reforms that will answer the mail. The commission will be composed of reform-minded local officials and other interested parties. Here are some of the reforms I think should be open for debate:
Consolidation of administration functions of counties and school districts: many Ohio counties and school districts are losing population so it might make sense to create tri-county commissions or school administrations covering several districts. This reform would reduce the number of “chiefs” and support staff and the costs of those people, thereby requiring less funding;
Partnership agreements in which cities and school districts share revenue: in some locations, cities and their school districts aren’t perfectly aligned. A particular city may be flush with cash from its income and sales taxes, as its school district is starving from its property tax. That is the case in my hometown of Dublin (usually has 80%+ of an entire year’s operating budget in reserve) and school district (population growth is driving school enrollment that is straining the budget). A revenue sharing agreement might allow both to continue to meet operational needs, but at a lower combined tax burden. I detailed this idea in my book, “Taxpayers Don’t Stand a Chance;” and
Revisiting the Purpose of the Local Government Fund: too many governors and legislatures have used raids on the local government fund to pay for other priorities. This “stealing from Peter to pay Paul” mentality leaves less funding for localities without a commensurate reduction in obligations. As a result, localities must raises taxes to cover those obligations. It may be time to eliminate the local government fund entirely and the obligations tied to it so localities have the full power over their operational priorities and how they fund those priorities.
The commission will be open to any and all ideas on how to achieve its purpose. I also believe we can bring in the smartest tax reform minds to strategize with us on how to make Ohio among the lowest taxing states in America. The only requirement of the discussion is that its outcome results in lower local tax burdens for Ohioans.
For those reading this piece who don’t like the ideas listed above, short of across-the-board reductions in pay and benefits (usually 90% of operational budgets go to personnel costs), which aren’t possible due to collective bargaining contracts (and repeal of Senate Bill 5), the actions above are about the only reforms that would lead to lower local taxes. Otherwise, get used to ever-rising local taxes.
In case you missed it, here is this week’s interview from The Bruce Hooley Show where we discussed the Devon Archer testimony in the growing Biden Family corruption scandal, the constitutionally inept Donald Trump indictment over January 6, and how powerbrokers are trying to rig the Republican State Central Committee to help Jon Husted in 2026.
P.S. To follow-up on my last post on Jim Renacci, I wanted to briefly reply to Renacci’s response in which he (1) accused me of endorsing Mike DeWine in 2018 and (2) questioned my math skills. On DeWine, my memory is that I undervoted the primary election, as noted in the Tweet above, and believe I wrote in John Adams in the general election, which I did again in 2022 after voting for Joe Blystone in the primary. On my math skills, Renacci has run and lost statewide three times: (1) he ran for governor in 2018, but dropped out a few months before the primary when he realized he’d lose to DeWine, (2) he then ran for the U.S. Senate against Sherrod Brown in 2018, which he lost by 6% in a +8 Trump state, and (3) he ran for governor again in 2022, which he also lost. Perhaps he wants a mulligan on the 2018 governor’s race, but he wanted to be governor (see 2022) and wouldn’t have dropped out if he thought he was going to win that race, as that would have been stupid.
