Municipal Income Taxes
Tax Rates and Amounts collected, by Municipality, Calendar
Municipal income taxes are generally imposed on wages,
salaries, and other compensation earned by residents and
nonresidents who work in the municipality. The income tax is
also applied to business net profits that are attributable to
activities in the municipality. Most municipalities allow a
partial or full credit to residents for municipal income
taxes paid to another municipality where they are employed.
Administration of the municipal income tax is strictly local,
either by the cities and villages themselves or by central
collection agencies under contract with various
State law requires that the rate must be uniform within a
municipality and cannot exceed one percent without approval
by voters. Rates of taxation in 2009 ranged from a low of
0.40 percent in the city of Indian Hill Village (Hamilton
County) to a high of 3.00 percent in the cities of Parma
Heights and Strongsville (both in Cuyahoga County).
The City of Euclid is the only municipality to levy and
collect municipal income taxes for its corresponding school
district. The city’s income tax is 2.38% while the Euclid
City School District has a 0.47% tax. Although the Ohio
legislature revoked this authority for all other communities
beginning in 2001, it has since re-enacted this authority
under the condition that only residents would be subject to
the municipal income tax.
There were forty-nine municipalities (or 8.49 percent of the
total) that did not submit calendar year 2009 (CY09)
data. Thirty-seven of these had data submitted by their
collection agency (RITA or CCA); for the remaining twelve
municipalities, prior year’s collections are shown.
Incorporating prior year's data, total CY09 municipal income
tax revenue is estimated at $3,937.1 million. This is a
decrease of $227.4 million or 5.46% from CY08.
Approximately $3,629.7 million was collected by cities and
$307.4 million by villages. Collections ranged from
$377 in Tremont City (Clark County) to $531.3 million in the
City of Columbus (Franklin County).
Assuming the remaining twelve municipalities still had the
income tax in effect in calendar year 2009, a total of 577
municipalities (236 cities and 341 villages) levied the
tax. There were thirteen municipalities that changed
the rate of taxation during calendar year 2009.
Data for Table LG-11 were obtained from surveys conducted
by the Ohio Department of Taxation.