Middletown could be the 10th municipality to support the initiative if City Council adopts the proposed resolution Tuesday night.
The goal of the document is to get the state legislature to introduce and pass a bill to require the state’s nearly 600 cities and villages to have nearly identical income tax regulations, such as due dates, extensions, withholding, rental property, statute of limitations, and penalty and interest. It would not alter a city’s income tax rate.
“What we’re trying to do is to mold the discussion at the state level to something that’s not going to hurt us,” said Middletown Finance Director Russ Carolus.
“It’s an idea that we want to bring forth to help guide the state to make sure that when they start talking about the rules that they are going to be changing that they try to make it as revenue-neutral to the city of Middletown as possible.”
The proposal, according to its proponents, will create local income tax uniformity without having the state’s involvement — though state legislation would be needed to require all municipalities to follow the regulations. State Reps. Cheryl Grossman, R-Grove City, Mike Henne, R-Clayton, and John Barnes, D-Cleveland, are exploring writing a state tax uniformity bill. Calls to their state offices were not returned.
Dayton City Manager Tim Riordan is one of those heading the regional initiative and said it’s key to get more than just a handful of municipalities behind the push for local income tax uniformity. There’s a plan to talk with representatives with at least 14 other cities, including Hamilton, Fairfield and Monroe.
“If 10 communities adopt it, it’s an interesting anecdote, but if there’s 30 communities that adopt it’s something that has to be taken seriously,” Riordan said. “Uniformity of regulations is really a good idea. It’s business-friendly. “
It can also be tax-payer friendly if a person works in multiple cities in a year, Riordan said.
Ohio is one of only 10 states that permit local governments to collect income taxes. The Middletown Journal reported in January the state had considered centralized local income tax collection with the goal to create local income tax uniformity.
The finance directors in Butler County’s three largest cities — Hamilton, Middletown and Fairfield — said in January the state couldn’t be as accurate nor as efficient in collecting local taxes, and there is a lack of trust with state government after so many cuts were made in the name of balancing the state’s biennial budget.
“We’ve absorbed a lot of losses at the state level here in the last year or two and we need to be more politically active in how that discussion occurs,” Carolus said.
Staff Writer Terry Morris contributed to this story.
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