As a small business owner, I have learned firsthand the impact of taxes on my business’s success. Rather than benefiting economic growth, high taxes act as penalties on productive activities like working hard, saving money and investing in the community. When businesses are overtaxed and lack the financial resources to expand, many are forced to relocate to other states and take valuable jobs with them.According to the Tax Foundation, states with the highest taxes deter business investments and drive many small businesses to lower-taxed states where they will have the greatest chance for success. Studies concluded that in the past decade, nearly four million people left states with the highest income tax (including Ohio) in favor of low-tax states like Texas and New Hampshire. Not surprisingly, states that have no income tax created nearly 90 percent more jobs than the high-tax states.
Here in Ohio, our tax burden is the 7th highest in the nation and our business tax climate ranks in the bottom four. Neighboring states have significantly better business climates, with Indiana ranked 14th, Michigan 20th and Pennsylvania 28th. Ohio is at a severe commercial disadvantage and if we fail to align our tax code with our neighbors, our state will perpetuate the mass exodus of young talent and professionals who take their businesses and jobs elsewhere.
During this recession, it is vital those of us serving in the Ohio Legislature do all we can to keep our home-grown businesses here in Ohio. While raising taxes might appear to be a quick and easy solution, the long-term repercussions will maintain a cycle of job loss, revenue loss and tax hikes. Ultimately, higher taxes and decreased profits will hinder job creation and market competitiveness which will destroy our state’s long-term economy and force future generations to bear the consequences. On the other hand, transforming Ohio into a business-friendly environment will create jobs and provide longer-lasting economic success than tax increases could ever offer.
The case has been made, and the data is clear, job creation increasingly goes to the states with two common factors. States that have no personal income tax and states that are “right to work”…those states that do not force workers to pay union dues. The Boeing Corporation is looking for a second production facility to build the 787 Dreamliner, the most sophisticated commercial passenger plane ever produced. Production is two years behind schedule due impart to a 57 day machinist strike. Ohio has the skilled labor force and the industrial base, yet Boeing is looking for a state that is “right to work” and business friendly. Our state is neither when it comes to creating jobs; not now and not in the foreseeable future if we do not make changes.
The stakes are high and with the global market becoming increasingly mobile, the rewards for implementing good tax policies are better than ever before. I am committed to promoting tax policies that will incite job retention and creation, and I will continue to be the voice for the small businesses in our community.
To best represent your interests here at the Statehouse, I need to hear your thoughts and concerns. I encourage you to contact my office at (614) 466-1507, or write to Representative John Adams, Ohio House of Representatives, 77 South High Street, 14th Floor, Columbus, Ohio 43215. You may also email my office at District78@ohr.state.oh.us.
