The Ohio Republican Party’s bill has been billed as another tax giveaway to the wealthy

A Republican lawmaker from Ohio says a bill eliminating capital gains taxes would make Ohio “a place that rewards investment and economic success, not one that discourages it.”

But Policy Matters Ohio says it’s another giveaway to the wealthiest while middle- and low-income Ohioans struggle to pay their bills.

Ohio House Bill 617 introduced by state Rep. Tom Young, R-Washington Township, would eliminate capital gains from state and local taxes.

Capital gains are profits from the sale of things such as stocks, bonds, real estate, art and jewelry.

In other words, it is not a tax on income from work, but on income from the sale of things you own. This means that people who own the most possessions face the most capital gains tax – and are the ones who stand to gain the most if the tax is eliminated.

This is exactly what Policy Matters projects in Ohio will do if HB 617 becomes law.

It found that 80% of Ohioans on the lower rungs of the income ladder will save at most $42 a year. Meanwhile, the top 1% – those earning $1.8 million or more – will save an average of $6,424.

This group will receive 61% of the tax relief pie, while the bottom 60% will receive just 3%, Policy Matters predicts.

To make the forecasts, the group analyzed data from the Institute of Taxation and Economic Policy.

Young, the sponsor of the latest proposed cuts, said it is necessary to attract and keep massive money in Ohio.

“Capital is mobile, and if we want to attract and retain opportunity, we must ensure that our tax policies reflect this reality,” he said in a March 24 speech press release.

Conservatives have been selling tax breaks and other benefits to the wealthiest for decades as a way to grow the economy and raise society at all levels of the economy.

However, British economists David Hope and Julian Limberg published in 2022 paper study of the effects of the 50-yeara dramatic decline in taxes on the wealthy in all advanced democracies.”

They found that the cuts increased income inequality but had no significant impact on economic growth or unemployment.

“Our results therefore provide strong evidence against the influential political-economic concept that tax cuts for the wealthy ‘trickle down’ to stimulate the broader economy,” they wrote in the Oxford Academic Socio-Economic Review.

Since John Kasich was governor, Ohio’s Republican leaders have provided Ohio’s wealthiest residents with a series of tax cuts and other benefits. Among them:

• The 2013 LLC Tax Creditwhich provides 40% of its benefits to the top 7% of LLCs and costs taxpayers approximately $1 billion annually.
• JobsOhio was founded in 2011 under Kasich’s leadership. She gave more than $1 billion of once public money to business interests, and yet it happened tried to demonstrate that it had created a significant number of jobs. He did, however, give $60,000 to a woman with whom former Ohio State President Ted Carter had “inappropriate relationship” to create four podcasts. She only created one.
• A “flat” state income tax was enacted in 2025. According to Policy Matters, it will cost $1 billion a year, with 40% of the benefit goes to people earning more than $1.8 million a year.

In total, the Legislature has cut income taxes by nearly $16 billion since 2005, with 70% of the benefits going to the wealthiest 20% of Ohioans, according to Policy Matters.

It is tough to understand how these cuts delivered on their promises to benefit all Ohioans. U.S. News and World Report ranks the state 38th place in economy and 43rd in terms of employment. It also has the 16th highest poverty rate.

And because taxes are reduced, the state still needs money to finance services. Aditi Srivastava of Policy Matters Ohio wrote that to fill the gap, the state will likely raise taxes that hit the penniless hardest.

“Repealing the capital gains tax would exacerbate existing inequities and likely require other regressive forms of taxation, such as sales and use taxes,” she wrote.

Srivistava added that eliminating state and local capital gains taxes in Ohio would worsen an existing problem.

“HB 617 represents a costly and unfair policy choice that prioritizes tax cuts for the wealthiest Ohioans at the expense of the state’s fiscal health and public investments,” she wrote.

“At a time when Ohio is already struggling to adequately fund schools, Medicaid and essential services, repealing the capital gains tax would further reduce revenues, deepen reliance on regressive taxes, and increase economic inequality – without providing significant benefits to most Ohioans.”