Ohio cities sue to repeal municipal tax reforms
A plethora of Ohio cities, ranging from Athens to Zanesville, filed suit on Monday to prevent the implementation of municipal income tax reforms passed last June in the state biennial budget (H.B. 49) and other reforms enacted in December 2014 (H.B. 5). The cities allege that the reforms infringe upon municipalities’ home rule powers and other constitutional rights under the Ohio Constitution. They seek to have the reforms declared void and to prevent the Tax Commissioner and other government officials from implementing them.
H.B. 49’s primary reform permits businesses to file their municipal net profits returns with the Tax Commissioner rather than with the relevant municipal corporations or their usual tax administrator and allows the Commissioner to administer the returns largely independent of the municipalities. H.B. 5 enacted a number of reforms including mandating allowance of net operating loss deductions and increasing the number of days a person could work in a municipality without becoming subject to its income tax.
The full complaint can be accessed here.
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