BuckeyeBlog

It looks like Ohio will, in one form or another, give tax credits to film companies which do business in the state. The general principle is good — lower taxes to spur economic growth — but the method is flawed. Tax breaks for special industries isn’t the best tax policy to help the state’s economy grow. Cutting taxes on businesses and marginal tax rates for individuals is a much idea.

It’s probably true that lower taxes on film companies will draw them to Ohio. Why should they be singled out for this benefit, though? Why not lower taxes on restaurants, factories, car dealerships, book stores, movie theaters, and every other business in the state? Don’t legislators want these businesses to expand in Ohio, too? And what about the state’s citizens? With so many of them losing jobs and struggling under high federal, state, and local taxes, I think it’s a bit strange to be rewarding Hollywood companies without so much as a debate over cutting Ohioans’ income tax rates.

Good tax policy means low rates on taxes that are broad-based. No breaks for favored industries. It’s unfortunate that the General Assembly is debating a special interest tax break instead of considering overall tax reform. If they want to get started, the Buckeye Institute has published a proposal to phase out Ohio’s income tax and has written about the five steps lawmakers should take to institute a pro-growth tax policy.

Tags: General Assembly, Taxes

This entry was posted on Wednesday, March 4th, 2009 at 3:20 pm and is filed under Economic Freedom. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.