Ohioans eye online sales tax revenue

MARIETTA – With the state generating more money than ever from the online sales tax, Ohioans have ideas on how those funds could be used and to see that money trickles down to local pockets.

Associated Press reported online sales tax collections hit $45 million in Ohio in the 2013-2014 fiscal year, which ended June 30. The record high is a 68 percent increase from five years ago.

“If the state has a surplus, it’d be good for the township for them to share a portion of that,” said Barlow Townships Trustee John Hannan.

Townships this year benefited from a bigger portion of the local permissive sales tax divvied up by the county, but funding received through the state has significantly dropped in recent years, said Warren Township Trustee Jeff Knowlton.

“Local government money has dropped almost 50 percent in the last couple of years. I think Warren Township was receiving $25,000 and now we’re down to $12,000 or $15,000 now,” he said.

To compound budgetary problems, counties recently lost the funds from the defunct estate tax.

When unplanned expenses occur, such as the culvert that failed on Silver Globe Road, the township finds itself relying on outside funding sources. Most of the culvert replacements is paid for through Ohio Public Works funding, said Knowlton.

Residents would like to see the online sales tax money go to things close to home as well.

Marie McGraw, 70, of Vincent, said schools should benefit, specifically special needs programs.

“We have a granddaughter with Down Syndrome, so I’d say special needs. They can always use more funding,” McGraw said.

Reno resident Nellie Parent, 78, would like to see the money for tax breaks for senior citizens.

“I think they ought to try to cut the taxes back if they’re getting more. Property tax would be one that would benefit a senior,” she said.

Washinton County Commissioner Ron Feathers said he would support sending online tax revenue to the county where the sale originated.

“Whatever comes from an individual’s particular county, they need to get that sales tax back,” he said.

The state has reduced funding to local government. For example, Washington County Children Services used to get most of its funding through the state, said Feathers.

“The state has cut back so much money and the county, out of the general fund, has to fund (Children Services),” he said.

Feathers said local governments can be more responsible for the funds they generate.

“Localized government is the best,” he said. “You can send $45 million to Columbus a year to be squandered in no time.”

Ohio Rep. Andy Thompson, R-Marietta, said the online sales tax money is not earmarked for projects or programs. The state can assess its needs and spend the money where it sees fit, he said.

Budgetary concerns have put the state itself behind on several of its planned infrastructure projects, he said.

The Ohio Department of Transportation has been sitting on projects that have been sidelined because of funding issues, Thompson said.

Ohio’s online sales tax will likely continue to grow. Part of this year’s revenue increase is credited to a new online sales tax initiative that only began in Ohio halfway through the fiscal year.

Ohio began taxing digital products, such as video streaming services and music downloads, on Jan. 1, according to Howard Wheat, public information officer for the Ohio Department of Taxation.

Ohio misses some sources of online tax revenue because there is no legal authority to collect, such as sales on Amazon.com because the online store does not have a physical location in the state. The loss is about $300 million a year, AP said.