Ohio Republican bill slammed as another tax giveaway for the rich

An Ohio Republican lawmaker says a bill that would eliminate capital gains taxes would make Ohio “a place that rewards investment and economic success, not one that discourages it.”

But Policy Matters Ohio says it’s yet another giveaway to the richest while middle and low-income Ohioans struggle just to pay their bills.

Ohio House Bill 617 introduced by state Rep. Tom Young, R-Washington Township, would eliminate capital gains from state and local taxes.

Capital gains are profits from selling things like stocks, bonds, real estate, artwork and jewelry.

In other words, it’s not a tax on income from work, but on income from selling stuff you have. So it follows that the people with the most stuff are on the hook for the most capital gains tax — and they stand to gain the most if it’s eliminated.

That’s exactly what Policy Matters Ohio projects will happen if HB 617 becomes law.

It said the 80% of Ohioans on the lower rungs of the income ladder will save at most $42 a year. Meanwhile, the top 1% — those making $1.8 million or more — will save on average $6,424.

That group would get 61% of the tax-break pie, while the 60% on the bottom rungs would get just 3%, Policy Matters projected.

The group analyzed data from the Institute on Taxation and Economic Policy to make its projections.

Young, the sponsor of the latest proposed cut, said it’s necessary to attract and keep big money in Ohio.

“Capital is mobile, and if we want to attract and retain opportunity, we must ensure our tax policies reflect that reality,” he said in a March 24 press release.

Conservatives have for decades been selling tax breaks and other benefits to the wealthiest as a way to grow the economy and lift up people all along the economic spectrum.

However, British economists David Hope and Julian Limberg in 2022 published a paper surveying the effects of 50 years worth of “dramatic decline in taxes on the rich across the advanced democracies.”

They found the cuts increased income inequality without having a significant effect on economic growth or unemployment.

“Our results therefore provide strong evidence against the influential political-economic idea that tax cuts for the rich ‘trickle down’ to boost the wider economy,” they wrote in Oxford Academic’s Socio-Economic Review.

Since the time John Kasich was governor, Ohio’s Republican leadership has provided a number of tax cuts and other benefits to the wealthiest Ohioans. Among them:

*The 2013 LLC tax break, which provides 40% of its benefits to the largest 7% of limited liability businesses and costs taxpayers about $1 billion a year.

*JobsOhio was created in 2011 under Kasich’s leadership. It has given more than $1 billion in what used to be public money to business interests, but it has struggled to show that it’s created a significant number of jobs. It did, however, give $60,000 to a woman with whom former Ohio State President Ted Carter had an “inappropriate relationship” to make four podcasts. She only made one.

*The “flat” state income tax passed in 2025. Policy Matters said it will cost $1 billion a year, with 40% of the benefit flowing to people making over $1.8 million a year.

In all, the legislature has cut income taxes by nearly $16 billion since 2005, with 70% of the benefit flowing to the wealthiest 20% of Ohioans, Policy Matters said.

It’s hard to see how those cuts have delivered on promises to benefit all Ohioans. U.S. News and World Report ranks the state 38th in economy and 43rd in employment. It also has the 16th highest poverty rate.

And, as taxes are cut, the state still needs money to fund services. Aditi Srivastava of Policy Matters Ohio wrote that the state will likely raise taxes that fall most heavily on the poor to fill the gap.

“Repealing the capital gains tax would deepen existing inequities and likely require other regressive forms of taxation like sales and use taxes,” she wrote.

Srivistava added that eliminating state and local capital gains taxes in Ohio will make an existing problem worse.

“HB 617 represents a costly and inequitable policy choice that prioritizes tax cuts for the wealthiest Ohioans at the expense of the state’s fiscal health and public investments,” she wrote.

“At a time when Ohio already struggles to adequately fund schools, Medicaid, and essential services, repealing the capital gains tax would further erode revenue, deepen reliance on regressive taxes, and widen economic inequality—without delivering meaningful benefits to most Ohioans.”