Open letter to Governor Kasich
Dear Governor Kasich,
While I admire much of what you have been able to accomplish in and for the State of Ohio, Governor Kasich, you have apparently learned nothing from one of your predecessors, former Gov. Taft. Coining your proposal as “Budget 2.0” albeit dated, is certainly the appropriate phrase, as the same type of tax code overhaul was (kind of) attempted under his governorship.
The short version is that you would like to reduce the state’s sales tax from 5.5% to 5.0%. You also propose to move away from only taxing “goods” to also taxing “services.” Granted, I’m no tax professional, have never played one on the internet, I am however, a real estate professional, and I do know how to read. And man, if this passes the legislature, you will be sticking it to the home buying and selling people of this State.
The implications of imposing a 5% sales tax on “services” which are currently exempt, in any one facet of the real estate industry, let alone all of them, could be more damaging than one might expect.
From the standpoint of the consumer, imagine a sales tax on each inspection; General Home, Well, Septic, Pest, and Radon. Think of having to pay sales tax for an appraisal and a home warranty. And of course, there could be a sales tax on the lender’s commission and any real estate brokers’ commissions earned in the transaction.
That is a heck of a lot of “5% of $X” making it to the State of Ohio’s coffers for just one home sale. Please remember, there is already a transfer tax payable to a county on the sale of residential property in Ohio, and the people who are involved in the transaction, pay taxes on their earnings.
Buying a home, selling a home, it is not an easy process, isn’t cheap, and is already taxed in this state. Imposing some twisted version of a Sin Tax, and calling it a sales tax on service doesn’t do a thing to encourage home ownership. It destroys it.