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Taft Outlines Tax Reform Proposal in State-of-State Address
COLUMBUS, Ohio -- Gov. Bob Taft today delivered his seventh State of the State address, calling for tax reform and strategic investments to grow Ohio's economy, create a more competitive business climate and add new high-paying jobs. Taft also outlined plans to make college more affordable."It's time to reform our tax system to reflect the economy of right now and tomorrow, not the economy of way back then, and yesterday," Taft said. "It's our No. 1 piece of unfinished work and my No. 1 priority. Together we must move Ohio forward into a new era of promise and prosperity."Taft's tax reform plan would cut personal income tax rates by 21% over five years; eliminate state income tax for Ohioans making less than $10,000 a year; and phase out the tax on equipment and inventory and the corporate tax, replacing them with a broad-based, low-rate commercial activity tax. Overall, the plan would collect $800 million less over the next two years than the state would receive if current tax rates remained in place. In conjunction with tax reform, Taft called for restrained state spending and reduced Medicaid growth. Taft asked for legislative support of strategic investments in Ohio's economic future through two proposed ballot issues: a bond initiative to accelerate the progress of the Third Frontier Project to create more high-paying jobs in the knowledge economy; and a renewal of the 10-year public works bond fund which helps local governments build roads, bridges and other public works.To make college more affordable for Ohioans, and in turn strengthen the competitiveness of Ohio's workforce, Taft announced:The new Ohio Student Lending Initiative, which will provide more than $100 million in low-interest loans to Ohio students. An expansion of the state's needs-based college grant program. The program will be aligned with federal Pell Grant standards and will expand eligibility to an additional 11,000 students. An expansion of the Ohio College Access Network, which provides young Ohioans and their families with access to college information and financing options. An annual tuition increase cap of 6% at state colleges and universities, to be exceeded only for the purpose of funding needs-based scholarships.To increase the number of Ohioans with college degrees, Taft supported a recommendation of his Commission on Higher Education and the Economy to create a statewide education partnership to engage educators, employers and legislators in building a continuous learning system for students pre-school through college. He announced three initial tasks for the partnership: better align high school graduation requirements with college readiness standards; increase the number of high school students who take a rigorous core curriculum; and create incentives for colleges and universities to improve their graduation rates."Let us resolve to do great things -- to finish our job for those hardworking, productive, innovative, can-do, compassionate and brave Ohioans who send us to Columbus to make this state a better place to live, work and raise a family," said Taft."