Small Businesses Oppose Tax Hike for Ohio Schools

Small Businesses Oppose Tax Hike for Ohio Schools
March 1, 1998

George A. Clowes

George Clowes is a Heartland senior fellow addressing education policy. He served as founding... (read full bio)



In apparent disagreement with the Ohio Supreme Court, which recently ruled the state must increase its education funding, only one out of three Ohio small business owners believes that too little is being spent on public education.

The Ohio affiliate of the National Federation of Independent Business polled 1,480 small business owners from across the state, revealing that nearly 78 percent oppose increasing any state tax--sales or income tax --to comply with the Court's order, which gives state legislators until March 1998 to develop a new funding system.

"Clearly this survey shows that Ohio small business owners, which account for more than 95 percent of all businesses in the state, have not yet been convinced that throwing more money at our public schools is the answer to education reform," said Roger R. Geiger, NFIB/Ohio state director. "Proponents of increasing taxes in the name of education have not done a very good job of convincing Main Street of the need to raise hundreds of millions of new tax dollars."

If Ohio legislators did have to change tax policy in response to the Supreme Court decision, they would encounter the greatest resistance to an increase in the state income tax, which 80 percent of survey respondents opposed. Some 71 percent opposed an expansion of the state sales tax base to cover currently exempt services, while 55 percent opposed an increase in the sales tax.

Rather than increasing taxes, 58 percent of respondents believe that reducing state spending is one solution to provide more money for education. Seventy-seven percent of survey respondents also said that school funding legislation should require schools to meet accountability standards before they received specified levels of funds. Sixty-three percent opposed allowing school districts to propose to voters levies that allow for inflationary growth on tax revenue from all real property.

Small employers are particularly concerned about proposed changes that could increase property taxes, with an overwhelming 86 percent opposed to increasing business property taxes by reducing the business property tax rollback. According to Geiger, the net effect of the changes would be to shift the tax burden from large corporations to small businesses.

"It is imperative that the cost of complying with the Supreme Court ruling is not forced disproportionately onto the backs of Ohio's small businesses," said Geiger, noting that NFIB/Ohio had 36,000 members and is the largest small business advocacy organization in the state and the nation.


George A. Clowes is managing editor of School Reform News. His email address is clowes@heartland.org.

George A. Clowes

George Clowes is a Heartland senior fellow addressing education policy. He served as founding... (read full bio)