Cropped BHI

BHI shows sales tax increase would eliminate 99,000 jobs in Ohio, cut capital $8.8 billion

For Release: January 16, 1998

Aubrey Haznar
Haznar Communications
          Scott Pullins
National Taxpayers Union of Ohio


Details of the economic analysis will be released at a


WHEN: Friday, January 16, 1998, 11:30 a.m.

WHERE: Ohio State House, Room 122

Boston, January 16 - A current proposal to increase the Ohio sales tax from 5% to 6% would, at a minimum, result in the loss of 99,000 jobs in the state, according to a just-released economic analysis. The analysis, performed by the Beacon Hill Institute at Suffolk University in Boston, further found that the tax increase would shrink payrolls by $3 billion and reduce the value of business structures and equipment by $8.8 billion.

BHI found that the tax increase would eliminate 1.7% of the jobs in the state. According to the analysis, this would cause the state unemployment rate to rise from 4.4% to as high as 6%.

“Our analysis shows that a state sales tax reduces business income. Less business income means less business demand for workers and for factories, machine tools and computers,” said David G. Tuerck, Beacon Hill Institute executive director. “Whatever the benefits of raising the Ohio sales tax, the economic consequences are measurably negative.”

The tax increase would permit the state to collect $1.024 billion in additional revenue in 1998. This estimate takes into consideration the revenue that the state would lose – $119 million – as a result of the reduction in payrolls that the higher tax would bring about.

The Beacon Hill Institute is a nonprofit research organization that applies state-of-the-art economic methods to the analysis of current public policy issues. Suffolk University has an enrollment of 6,000 full and part-time students in both undergraduate and graduate programs.

To obtain the BHI FaxSheet detailing results, call BHI at 617-573-8750 or view it on BHI's website.

Last update: 1/16/98
Format revised on 7/2/03 15:17

1996-2003, Beacon Hill Institute.
All rights reserved.

Please send any questions or comments about this web page to Frank A. Conte at