Ohio governor proposes elimination of nearly all income taxes paid by small businesses

Gov. John Kasich on Thursday proposed eliminating nearly all income taxes paid by small businesses to take advantage of the improving economy and help more people get jobs.

Kasich's proposal, to be unveiled in his budget next week, eliminates the tax on income for small businesses with annual gross receipts of $2 million or less. The governor also is bumping up the personal income tax exemption for low- and middle-income workers.

Kasich said the fact Ohio has regained thousands of jobs lost in the recession and has a current unemployment rate of 4.8 percent is good, but not good enough.

"We have to continue to drive the incentives for job creation," Kasich said as he unveiled the proposals at the Ohio Association of Community Action Agencies' winter conference.

Kasich also unveiled proposals to help economically struggling Ohioans move out of poverty. He's proposing making it easier for low-income families to keep child-care subsidies as their income increases. Kasich also wants county job centers to create more comprehensive programs to focus a variety of services on individuals based on their needs.

Kasich, a Republican, often speaks of the need to help the disadvantaged even as he promotes the importance of business development. He bucked some in his party by pushing Medicaid expansion under President Barack Obama's health overhaul.

"Helping people who live in a difficult situation and allowing them to stay there is a rip-off to them and to their children," Kasich said.

Thursday's appearance comes in the wake of an inaugural address in which Kasich said he wants to see some of the state's economic prosperity shared with people who live "in the shadows," such as the poor, mentally ill and undereducated. Kasich's budget plan is due out Monday.

GOP Senate President Keith Faber, speaking at an annual legislative forum sponsored by The Associated Press, praised the governor's move to cut the income tax for small businesses.

___

Associated Press Writer Ann Sanner contributed to this report.