Legislature Says “No” to Sales Tax Expansion on Services
OADA News
Key Legislative leaders cite OADA lobbying efforts and dealer grassroots support as critical components of abandoning Sales Tax Expansion on Services in the State Budget.
State Budget tax package includes the following for dealers:
PROS
- No expansion of the sales tax to services as proposed initially
o Ohio Dealers were impacted over $100 Million annually by the initial proposal to tax things like advertising, commercial rent, holdback, etc.
- 10% reduction in personal income tax rate over three years beginning with tax year 2013
- 50% tax cut for pass-through entities on the first $250,000 in net business income beginning with tax year 2013
- No increase to the CAT rate. Rate remains at .26 % of gross receipts
- Sales Tax Trade-In Credit on the money difference protected
- Vendor Discount remains intact
o This is the portion of the sales tax that dealers retain for collecting sales tax on behalf of the state
CONS
- Tiered increase to the minimum CAT liability payment on the first $1 million in gross receipts beginning in 2014.
- .25% increase to the state sales tax from 5.5% to 5.75% (effective 9/1/13)
At the end of the day, Ohio Dealers went from a net loser of over $100 million annually under the initial proposal to a net winner under the final product.
An in-depth analysis of this state budget will be available soon on www.OADA.com
OADA would like to thank DIG contributors and those who contacted their legislators. YOU WERE CRITICAL TO OUR SUCCESS! Contact either Joe Cannon or Zach Doran at OADA with questions or to learn how to support OADA’s legislative efforts.
Joe Cannon
