State Rep. Tom Young promotes his bill to abolish the net capital gains tax

A state lawmaker wants to make Ohio more competitive by eliminating a “tax burden” that he believes could be hindering growth.

House Bill 617, the Ohio Capital Gains Tax Repeal Act, intends to position Ohio as a “more competitive destination for investors, entrepreneurs, and retirees by removing a tax burden that can influence where individuals choose to live and invest,” according to a release.

State Rep. Tom Young, R-Washington Township, considers net capital gains an example of that “tax burden” and wants to remove it from both Ohio’s state income tax and municipal income taxes.

“Ohio should be a place that rewards investment and economic success, not one that discourages it,” he said in a release. “Capital is mobile, and if we want to attract and retain opportunity, we must ensure our tax policies reflect that reality.”

According to the release, the bill would not impact property taxes, sales taxes, or the Commercial Activity Tax, but instead remove net capital gains from the taxable base, “using the existing federal definition to ensure clarity and avoid creating new administrative burdens.”

“Right now, when someone takes a risk building something, and they build it, and it creates value, we tax that success again at the state level,” Young said, according to NBC 4. “If we want entrepreneurs to build here and we want retirees to stay here, and we want capital flow into our communities instead of leaving the state, then we need to act.”

An analysis by the Legislative Service Commission revealed that Ohio would lose between $615 million and $645.6 million in tax revenue in 2027 and between $647.8 million and $679.8 million in 2028. However, Young argued that the actual estimate would be somewhere between $185 million and $390 million a year, according to The Columbus Dispatch.

NBC 4 reported that House Speaker Rep. Matt Huffman, R-Lima, is seemingly in support of the bill, considering that he recently said that “all taxes” hurt economic activity and job growth.

“That’s why smaller, lower rates, and this is a little counterintuitive but, in fact, is true, it produces more revenue for the government,” he said, according to the news source.

The Ohio Chamber of Commerce’s Director of Economic Development and Tax Policy, Liz Baumgartner, supported the bill, saying that the elimination of the tax would “encourage investment, support entrepreneurs, and strengthen our state’s competitive position,” according to The Dispatch.

House Minority Leader Dani Isaacsohn, D-Cincinnati, however, opposed the bill, saying that getting rid of Ohio’s capital gains tax would only help wealthy people while sacrificing public services provided via taxes, according to NBC 4.

“Over the last two decades, there has been a massive wealth transfer from everyday Ohioans to the people in the top one percent, sometimes in the top one percent of the top one percent,” he said. “That is why we are underinvesting in our schools. This is why we are not opening new health clinics in every county or new hospitals, but closing them. It’s why people struggle to access good jobs and a house they can afford.”