This piece originally appeared on Cleveland.com on April 5, 2026.
It’s spring-cleaning time, and just as we must decide whether certain items still make sense in our households, we should do the same for state-level tax expenditures — another name for tax breaks. The term covers anything from deductions, exemptions, and credits to preferential tax rates.
While they can play a useful role in making Ohio’s tax code fairer, tax expenditures also reduce revenue. Every dollar not collected because of a tax break is a dollar we can’t invest in public goods Ohioans rely on. Lost revenues mean lawmakers must either cut services, shift costs onto local governments and taxpayers, or forgo opportunities to strengthen Ohio’s economy and communities. So, it’s important to ensure that state tax expenditures are appropriate, transparent, and effective.
Some of these tax expenditures take up resources that could support people-first investments like a child tax credit, a refundable Earned Income Tax Credit, or a property tax circuit breaker. Here’s Policy Matters Ohio’s spring-cleaning shortlist of tax expenditures to trim or trash:
Private jet timeshare tax-cap: We can’t fund our schools adequately, yet we’re giving sales-tax breaks to people who can afford a timeshare on a private jet. Is that really where our priorities should be?
Forgone revenue for fiscal years (FY) 2026-27: $19.4 million
Verdict: TRASH
The Commercial Activity Tax: The CAT is Ohio’s general business tax. (Unlike most states, Ohio has no state-level corporate income tax.) It is levied on total business receipts before deducting expenses. It was designed to apply across most businesses, with exceptions such as banks, insurance companies, and utilities. But in the 2023 Ohio budget, lawmakers shrank the CAT so dramatically that fewer than one-tenth of Ohio businesses now pay it. By raising the threshold when the tax applies from $1 million to $3 million in Tax Year 2024 (and $6 million in subsequent years) and eliminating minimum tax tiers, legislators effectively transformed the CAT into the state’s third-largest tax break. All so that most businesses can pay even less while everyday Ohioans tighten our belts.
Forgone revenue for FY 2026-27: $1.5 billion (Changes in 2023 increased this expenditure’s costs by roughly $500 million.)
Verdict: TRIM – Lower the threshold of this exemption and implement a corporate income tax.
Data center sales exemption: Ohio exempts qualifying data center companies from paying sales tax on construction materials and computer equipment these facilities use. Repealing this exemption would ensure that data center companies—who pay no state corporate income tax and often get property tax abatements—contribute more fairly. While the governor vetoed the repeal in the last budget, Ohio can still control-alt-delete this break from any new agreements.
Forgone revenue for FY 2026-27: $289.8 million (Eliminating this break would not impact existing agreements but would prevent this expenditure from rising.)
Verdict: TRASH
Spring’s the perfect season to sort through things that take up space without serving a purpose. This list is just a starting point; Ohio’s 2024 tax expenditure report outlined 177 tax expenditures totaling an estimated $25.4 billion in lost revenue over fiscal years 2026–27. That’s more than what the state legislature allocated for K-12 funding over that period.
It’s high time to clean house, and make more resources available to benefit Ohio families, kids, workers, schools, and communities.
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