In his bid to become Ohio governor, Vivek Ramaswamy announced that he wants to get rid of individual income taxes in the Buckeye State.
Why It Matters
Ramaswamy, an Ohio native, a biotech entrepreneur, and a candidate in the 2024 Republican presidential primaries, announced his 2026 campaign for Ohio governor last month.
Eliminating Ohio’s income tax would massively reduce tax revenue for the state—threatening a huge increase in debt. Questions remain over how Ohio would generate enough income to fund vital services.
The majority of states across the country levy state level income taxes, excluding Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.
What To Know
Ohio currently has a graduated individual income tax rate, which means how much you pay is based on how much you earn. Rates range from 0 percent for those on low incomes, 2.75 percent for those earning under $100,000 per year, and 3.5 percent for the highest earners.
But Ramaswamy, if his bid for the governorship is successful, wants to do away with income taxes. But this will most likely be done over a period of several years, rather than being eliminated quickly.
“It’s going to be a combination of growth and cutting unnecessary expenditures,” Ramaswamy, a Donald Trump loyalist, said, The Columbus Dispatch reported. “It’s not going to be immediate. I haven’t promised that it’s going to be immediate, but what I’ve said is we’re going to bring it down and put us on a path, on a clear, credible, pro-growth path to zero income tax.”
A spokesperson for Ramaswamy told Newsweek: “Vivek will have more to share about his policy proposals to Make Ohio Great Again, including his tax plan, in the coming months.”
Over the past two decades, Ohio Republicans have significantly reduced income taxes, cutting them from a system with nine tax brackets and a top rate of nearly 7.2 percent in 2005, the newspaperreported.
However, critics have said cutting income taxes could leave a big gap in the state’s revenue. The levy brings in nearly $10 billion per year, or about a third of the state’s tax revenue, according to the Tax Foundation, a Washington, D.C., think tank.
Ohio Attorney General Dave Yost, who is also running for governor as a Republican, has agreed that income taxes should be cut, but a lack of a plan on how this could be implemented could “create chaos and harm.”
States that do not have income taxes tend to recoup the money, which is used to fund public services, in other ways. For example, Florida, which has high rates of tourism, has general state sales tax rate of 6 percent, with discretionary sales surtax charged in some counties. Texans are also responsible for paying some of the highest property tax rates in the country, according to the Tax Foundation.
“There are ways to get there that don’t necessarily require raising the sales tax particularly,” Ramaswamy said about eliminating income tax, The Columbus Dispatch reported.
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Meanwhile, U.S. Commerce Secretary Howard Lutnick said last week that President Trump has a goal to remove taxes for individuals earning less than $150,000 per year. He also outlined Trump’s other tax strategies, which include abolishing tax on tips, overtime, and Social Security, and implementing significant reductions to individual and corporate taxes.
Lutnick said the federal government would counteract massive U.S. tax cuts by implementing tariffs on foreign nations and curbing overseas tax evasion.
What People Are Saying
Bailey Williams, a tax policy researcher with Policy Matters Ohio, a left-leaning think tank, said: “The idea that we’ll just go around and cut a third of our state revenue and just abdicate our responsibility as a state government to our citizens is irresponsible on several levels.”
Ohio Attorney General Dave Yost said: “Doing it with a chainsaw, one fell swoop without a plan to actually do it smart is going to create chaos and harm among some of our most vulnerable voters. The difference between bold and reckless is whether you have a plan to do it.”
Ohio Governor Mike DeWine, who proposed no income tax cut in his two-year budget rollout, said in January: “We have cut taxes and cut taxes and cut taxes, and we’re very, very competitive today. There’s really no reason to go beyond this.”
What Happens Next?
If successful in his gubernatorial bid, Ramaswamy will replace DeWine who has served the state since 2019.
