Several incarnations of the budget before this one, I wrote about how retirees would be disproportionately impacted by the then proposed budget.  Well, now we have a final, passed and signed budget – and the news is even worse for retirees….

Kasich’s budget shifts the tax burden from the wealthy onto those who are lower income or on fixed incomes – especially retirees.  There is an income tax cut which disproportionately helps the wealthy and does little to nothing for those who are retired.  There is a sales tax increase – which disproportionately hurts those who are on fixed incomes.   Those who are retired are spending most if not all of their income – and depending upon the retirement investments they might have, they are frequently spending their savings too.  So the money being spent will now be taxed at a higher rate.  In short, the tax shift creates a more regressive tax structure from a progressive one. (Policy Matter Ohio did a nice breakdown of the impact by income bracket here:  http://www.policymattersohio.org/itep2-jun2013).

But that is not the worst of the budget woes hitting retirees.  Retirees who own their own home will face even more of the Kasich tax shift burden.   The Cincinnati Enquirer estimated that the average homeowner in Southwest Ohio will face at least $400 more in property taxes a year.

Local government funds continue to be hit as do school districts.  That means that either services will continue to be cut or there will be more levies.  But Ohio did away with paying their portion of levy money (12.5% property-tax rollback) that has been in effect since 1971.  So, every levy will cost homeowners even more.  Yes, voters can reject those levies.  But that means cuts to Senior Services, fewer first responders, poorer roads, or worse school districts.  Even when retirees don’t rely on these services (such as schools), having them deteriorate means the value of their home declines – and for most retired homeowners, their home is their largest asset.    When they do use the services, the cuts can be quite serious.  Everyone wants (and expects) the EMTs to arrive quickly after a medical emergency is called in.

And then young retirees or those who hope to retire in the near future face an additional hit.  Ohio has a homestead exemption for seniors.  That means, if you are over 65 years old, the first $25,000 in value of your home is not subject to property tax.  If you are already 65 by December 31; you are golden in this respect and will be grandfathered in.  However, if you are 64, you might no longer get the exemption.  Because now, the exemption will only be offered to those who are 65 AND who make less than $30,000 a year (the $30,000 income is inclusive of most pensions).   So, if you are a middle class Ohioan who turns 65 next year, but isn’t retired yet because you don’t yet qualify for Social Security, you can probably kiss that homestead exemption good-bye.

The members of the Ohio Alliance for Retired Americans (of which there are about a quarter of a million) don’t mind paying their fair share.  We, at the Alliance, know that there are needed public services that create strong communities.  We also know that those public services need to be paid for with public money.  But it is simply not fair to shift the tax burden onto retirees in order to cut taxes for millionaires or in order to giveaway deals for Republican donors.   Unfortunately, this is exactly what the budget signed by Kasich does.

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Bentley Davis is the State Director for the Alliance for Retired Americans in Ohio

 
  • clr1390

    The retired people do not yet know what is in store for them. It would be on Fox News 24 hours a day 7 days a week with free get out the lies. That is how Republicans stay so clueless to the lies. Until the tax bill hits and people figure out what it is going to cost them.

  • carrieee4

    Really I already pay taxes to the state. They are spending more money yet many things the state used the tax monies for is being reduced so I have to spend more in taxes in the long run making up for what they are no longer using the tax money for. What the h&!! They are spending more on WHAT????? WHen they have cut all our services and funding of the schools, they are cutting all the things we have been supporting all these years. Yet they are spending more money on the budget then the last two budgets. WHERE IS THE TAX PAYERS MONIES GOING?! When you talk about taxation with out representation I think THIS IS IT in a total nutshell. I do not remember anyone complaining about where we have spent our tax dollars in the past years to the point that the Gov. should be doing what he and his cronies are doing. PEOPLE all PEOPLE living in Ohio and all states where we see this crap happening need to start yelling about it at the top of their lungs until something good happens. Really unless we start doing something about this crap they WILL keep it up until we will not be able to recognize our country as the great country it once was.

  • Ramona Hauenstein

    Wow, I live in Allen County and pay $1400 a year in property taxes ($117) a month. I certainly can’t afford much more. I am retired, but work part time. Because of medical problems and the bills that go with it, I am stretched to the limit.

  • dmoore2222

    These liars and cheaters have figured out that you are a responsible citizen and will pay up because you have a strong work ethinc and sense of duty to your community, Ramona. Yet instead of considering you when it’s time to fund those services that you and I rely on and expect from our tax contributions, they throw money at corporations and rich people who fund their campaigns claiming these are the people who create jobs, a highly debateable claim. And hundreds of millions of dollars from state liquor sales that go to JobsOhio that we cannot see accounted for. I wonder why we’re not all out screaming on capitol square.

  • anastasjoy

    I should move to Allen County! Taxes in my suburb of Cleveland are over $3,500 per $100,000 valuation, and we’re probably going to see a November levy which will raise that more than $200 (plus a little bonus for Kasich!). We’ve already had one, which passed, since Kasich slashed school funding so, two school levies during Kasich’s first term alone. The more I look at the numbers, the more it looks like my Kasich tax increase has ALREADY cost me about 15 times what my income tax cut will probably be. If we pass a new levy, I’ll probably be paying about 30 times more annually than the amount of my Kasich tax “cut.” And that’s not even including the sales tax increase, and I would not be shocked if there are some other unpleasant little surprises like fee increases. Taxin’ John Kasich is on a taxing spree!

  • anastasjoy

    This is what I would like to know. Tax-and-spend Kasich’s budget is $62 billion, up from his last budget of $56 billion. Strickland’s last budget was $50.5 billion. That’s a staggering increase, yet money for schools and local government services has been slashed to the point where the state is bleeding to death.

  • Ramona Hauenstein

    I should have said that I’m not complaining about the amount (Allen County is one of the cheapest areas to live). I’m just saying that I’m at my limit and if they raise my taxes that much, with my fixed income and expenses, I don’t know what I’ll do.

  • LauraKY

    Oh well, I was thinking about Ohio for retirement…

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