Bill would clean-up Ohio tax laws

by Danielle Lipp
THE POST

In the spirit of spring cleaning, a bill introduced by Rep. Greg Jolivette, R-Hamilton, would clean up Ohio’s tax laws and make taxpaying easier for citizens.

The Taxpayers Services Bill is designed to update or eliminate obsolete tax laws and make it easier for taxpayers to use the system. It also would decrease the Ohio Department of Taxation’s workload, said Robert Horne, Jolivette’s legislative aide.

If passed, the bill would make a number of small changes to Ohio’s tax laws.

One proposed change is expanding delivery services beyond the U.S. Postal Service so taxes can be filed electronically, Horne said.

The bill also would eliminate the mandatory requirement for imposing penalties. This means the tax commissioner will be able to decide whether to penalize offenders based on the evidence of each case.

Overall, the bill is designed to be taxpayer friendly, said Jim Henry, senior vice president and general counsel for the Ohio Council of Retail Merchants. One particular provision illustrates this point, he said.

When people receive their taxes now they have 30 days to file an appeal or they lose the right. But because the process is extensive and time-consuming, the bill would increase the time limit from 30 to 60 days, Henry said.

Another provision would allow a vendor’s license issued for one address to be transferred to a new location within the same county. Currently, vendors who relocate must cancel their existing licenses and apply under their new addresses.

Gary Gudmundson, communications director for the department of taxation, said the bill gives taxpayers and the department a chance to save money. But, if passed, it also would eliminate some money that the Ohio Department of Transportation and the state’s general revenue fund receive.

For example, the bill would eliminate renewal fees for vendor’s licenses. These annual $10 fees normally contribute $2.7 million to the general revenue fund. But because the state as a whole has a budget of about $15.6 billion, the loss would not be substantial, he said.

Another provision would reduce the amount of money ODOT receives each year by $425,000. The bill would eliminate the need for truckers and motor carriers to buy a fuel use permit, but Gudmundson said ODOT reviewed and accepted this provision.

Along with altering license and permit laws, the bill also would change income tax laws.

Gudmundson said most people have their income tax withheld in their paychecks. Now, if citizens owe $300 or more they must file quarterly returns.

But if this bill passes, it will increase this threshold from $300 to $500, meaning people who owe less than $500 would not have to file quarterly returns.

Gudmundson said this would affect mainly self-employed citizens and it also would reduce the number of people filing quarterly tax returns by 15 percent.

Therefore, 60,000 more people would not have to file quarterly returns and the department of taxation would save $100,000 a year in processing costs, he said.

The department would save an additional $325,000 through another provision in the bill. This amount would happen if tax returns are rounded to the nearest dollar.

If passed, this bill would make many little changes to Ohio’s tax laws, reducing the hassle many people experience, Gudmundson said.

"We’re trying to make sure that the focus is on providing quality service to the taxpayers and making it as easy for them as possible to deal with the system," he said.

Henry, of the council of retail manufacturers, said the provisions in the bill would affect virtually all taxpayers, from businesses to individuals to retailers to manufacturers.

"It’s probably the first general revision of the Ohio tax code," Henry said.