On May 9th, the Ohio Attorney General approved ballot language for a signature drive to end property taxation in Ohio. Advocates for the petition argue sharp increases in property taxes make payments too difficult for taxpayers to predict, plan for, and pay.
In a survey released this morning by Scioto Analysis, 10 out of 16 economists surveyed disagreed that replacing property taxes in Ohio with higher sales and income tax rates will reduce the volatility of tax payments for Ohio households.
Kevin Egan from the University of Toledo disagreed, writing “Sales and income fluctuate with the business cycle. Having property taxes, especially taxes directly on the value of the land (not what is built on it) is one of the first-best tax options due to the amount of land to be taxed does not change.”
Conversely, Charles Kroncke from Mount St. Joseph University agreed with this statement, but offered the caveat “This will mainly benefit wealthy older people who don't work. This will not help working class younger people who spend their income on consumer goods.”
Property taxes are commonly used to fund public schools, and when asked about the impact on school funding 12 of 16 economists agreed that removing property taxes will decrease overall per pupil spending in Ohio’s public schools.
David Brasington from the University of Cincinnati was uncertain about the impact on school spending, writing “Ohio already has the option of school district income taxes; the effect on spending depends on how much voters decide to shift from property to income taxes.”
The Ohio Economic Experts Panel is a panel of over 30 Ohio Economists from over 30 Ohio higher educational institutions conducted by Scioto Analysis. The goal of the Ohio Economic Experts Panel is to promote better policy outcomes by providing policymakers, policy influencers, and the public with the informed opinions of Ohio’s leading economists. Individual responses to all surveys can be found here.