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News Release

Sept. 17, 2009 – Tax commissioner pleased with Supreme Court decision on CAT

Ohio Tax Commissioner Richard A. Levin offered this reaction to the Ohio Supreme Court’s 6-1 decision in Ohio Grocers Association v. Levin:

I’m pleased to see that the Ohio Supreme Court recognized that the commercial activity tax is not a tax on the sale or purchase of food. It is, as we’ve said, a broad-based tax that applies to all businesses in Ohio, measured by gross receipts. This decision is an important victory for those who are working to improve Ohio’s business tax climate and lower the tax burden in Ohio.

The commercial activity tax is a key part of a sweeping, five-year effort to reform Ohio’s tax laws. The plan includes a 21 percent cut in income tax rates, the elimination of a tax on corporation profits and the elimination of property taxes on business machinery, equipment and inventory. Overall, these and other changes enacted in 2005 mean $2.1 billion in annual tax relief.

Had this case gone the other way, all of these changes to Ohio’s tax laws may have been at risk.

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