Kasich Wants To Cut Tax Withholdings, Beef Up Rainy Day Fund
The state’s budget office is forecasting a surplus at the end of this fiscal year. Gov. John Kasich says he wants to take that extra money and adjust withholdings, resulting in more money in Ohioans’ paychecks.
The plan is a spinoff of a tax cut the Ohio Legislature passed three years ago. That 6.3-percent cut is reflected in the annual tax refund, about $152 million, but Kasich wants people to see that money sooner.
There’s an upfront cost to reducing the amount of money withheld from paychecks. Kasich wants to take the projected surplus and use it to adjust those withholdings.
“We’re not going to do this till November until I’m certain that we’re going to be in good shape on this, but this isn’t going to put anybody in any hole. This isn’t going to be like some Kansas deal where we just cut taxes and don’t pay for it,” Kasich said.
The proposal is based on a projected $368 million surplus, and would add $68 million to the Rainy Day Fund - pushing it to the limit of $2.75 billion.
Ohio Democrats have criticized Kasich for not using the Rainy Day Fund to fight the opioid crisis, or for investing in community issues like infrastructure or broadband access. Last month, Kasich said officials "whine" about wanting money for special projects instead of saving for an economic downturn.
The administration wouldn’t say if they needed approval from lawmakers to move forward with this plan.