Opinion Editorials

How Ohio Gov. Kasich’s proposed budget could kill home sales

gov. kasich

Governor Kasich recently proposed a new budget for the state of Ohio includes some tax changes that could do a great deal of damage to home sales and homeownership.

gov. kasich

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.

7 Comments

7 Comments

  1. j99

    February 6, 2013 at 4:05 pm

    “Most goods and services related to education, healthcare and housing would remain exempt from the tax.”

    http://www.daytondailynews.com/news/news/state-regional-govt-politics/new-sales-taxes-to-hit-many/nWGks/

    • Katie Cosner

      February 6, 2013 at 4:20 pm

      Only housing as it pertains to renting and construction would be exempt. Anything that is a “service” or a “business” would/could be taxed.

  2. Jay Seville

    February 7, 2013 at 12:17 am

    In the blink of an eye confiscating 5% of a realtor’s income is disgusting. How does that benefit the economy? How does taking away 5% of the agent’s income help them grown their business or hire an assistant? BOGUS and anti-american! You’re not a conservative kasich if this goes through.

    NC is proposing an 8% service tax on commissions. Agents are already paying taxes who the heck do these politicians are just adding another 5 or 8% onto their taxes? Unfortunately it’s all very believable.

    • Katie Cosner

      February 7, 2013 at 4:08 am

      Jay, this is, or would be a sales tax on services that are now currently exempt and would be paid by *consumers* and would apply to virtually everything, except healthcare, education, residential rentals and construction. This is not about taxing commissions.

Leave a Reply

Your email address will not be published. Required fields are marked *

Trending Now On A/G

To Top