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Centralized collection appeal gets May 13 court date

Written on May 1, 2020

OSCPA staff report

The Ohio Supreme Court has scheduled oral arguments for May 13 in cities’ appeals of municipal income tax reforms.

To recap, cities in 2019 filed an appeal that seeks to overturn an earlier appeals court ruling upholding OSCPA-supported reforms in 2014’s House Bill 5, and in 2017 law changes eliminating sales throwback and a centralized filing and payment option for the municipal net profits tax. The Ohio Supreme Court on Aug. 6 granted jurisdiction to hear the appeals on the cities’ assertion that the laws violate the “Home Rule” provision of Ohio’s constitution.

But Ohio’s archaic municipal net profits tax system costs businesses more to comply than cities make in revenue, OSCPA wrote in November in amicus briefs filed in the two separate cases before the Ohio high court.

OSCPA leads the Municipal Tax Reform Coalition, a broad partnership of statewide organizations driving reform of Ohio’s municipal income tax code. The group argues that centralized administration of the net profit portion of the municipal income tax would save taxpayers as much as $800 million per year, but the provision itself only nets cities $750 million annually.

OSCPA Tax Policy Director Greg Saul, Esq., CAE, said a decision is likely to be rendered in autumn 2020. He added he remains confident the laws are constitutional.

For more information on this important issue, contact the OSCPA government relations team.

Related: Muni tax registration deadline approaches for 2020; new registration generator tool available