Ohio Department of Taxation testifies on state tax proposals

Provided by Hannah News Service 

Tax Commissioner Patricia Harris gave the Ohio House Finance Subcommittee an overview of tax proposals Gov. Mike DeWine has made through the budget, including a tax exemption of $2,500 per child and a sales tax exemption for critical infant supplies. There are also low-income and single-family housing tax credits, which would be overseen and implemented by the Ohio Housing Finance Agency, and a Home Ownership Savings Account in partnership with the state treasurer’s office. 

Harris also discussed accomplishments by Ohio Department of Taxation (ODT) staff in the past year such as stopping over $19.7 million in fraudulent refund requests; developing an electronic system for all legal cases that brought the average cycle time for appeals from 4.5 years to 18 months; implementing a call center system that allows for callback requests rather than being on hold; and creating a web-based filing option for county auditors. She also said ODT is on track to meet FY22-23 goals regarding technology. 

Primary objectives for FY24-25 include “core responsibilities” of processing tax returns, payments and refund requests; providing customer service to taxpayers; improving operations; continuing to identify efficiency gains; and conducting audit and compliance programs. Other upcoming priorities are finalizing Project NextGen, addressing staffing challenges and increasing collaboration with other state agencies. 

The budget request includes $95.9 million in FY24 and $98.5 million in FY25 for personal services; $6.1 million in FY24 and $4.2 million in FY25 for contract services; and $30.7 million in FY24 and $34.3 million in FY25 for supplies and maintenance. 

Chair Patton noted Harris only had 30 days on the job but said no one would have known from her testimony. She described her work at the Bureau of Workers’ Compensation (BWC) in response to a question he had, saying she hopes ODT employees will also have dialogue with Ohioans as BWC staff did.  

Rep. Grim asked about the Home Ownership Savings Account, which she said would be budgeted at $50.4 million per year. ODT Chief Legal Counsel Sarah O'Leary said ODT staff brainstormed ways to encourage home ownership with the treasurer’s office and put together projections on how much could be set aside for it, saying that was how $50.4 million was reached. She added that it could be a pilot program and told Grim that discussions are underway with the treasurer’s office on how it would be administered. ODT Legislative Director Tim Lynch told Rep. Cutrona the funds could be used for making a downpayment on the house and would be similar to a 529 plan. 

Harris and O’Leary discussed the differences between tax credits and deductions with Ranking Member Skindell as well. O’Leary also told him other states prohibit companies from charging fees for state tax completion or giving a notice about free options and said ODT could work with him on a similar law in Ohio. Harris answered questions on modernization from Skindell and Patton, saying the average time before people receive an ODT callback is 30 minutes.