During the Great Recession, Ohio has cut its budget to ribbons, reducing funds for health services, higher education, and K-12 education. The budget cuts are so severe that some towns might officially cease to exist (due to disincorporation).

However, it seems that Gov. John Kasich (R-OH) and the Republican legislature feel that the state has money to burn on tax cuts for the financial industry:

An Ohio Legislative Service Commission analysis said the bill “may decrease GRF (general revenue fund) revenue by an uncertain amount, though the revenue loss may be up to $30 million per year, when compared to the introduced version of the bill.”

The potential of a $23 million to $30 million tax cut for financial institutions drew fire from Democrats at a time when schools and local governments are suffering from significant budget cuts.

Kasich’s original plan was meant to be revenue neutral, but the legislature cut it up until it turned into a gift to the banks worth millions of dollars. As Policy Matters Ohio noted, the justification for cutting banks’ taxes — that they will use the money to increase lending — is fundamentally flawed:

The idea that cutting bank tax rates will fuel more lending and a stronger economy is misplaced. Since many Ohio banks already are “flush with cash,” as a representative of the industry puts it, cutting their taxes is unlikely to lead to new lending. Ohio banks are doing well, as a Feb. 28 press release from the Ohio Bankers League entitled “Bumper Quarter for Ohio Banks” attests, and are in no need of a tax cut.

“We’re basically giving the banks … a $25 million gift every year,” said state Rep. Mike Foley (D). “But we’re also doing that in the context of an economy and state budget in Ohio that has been wracked and harmed and hurt and mangled by the financial industry that we’re giving benefits to today.”

Teton Village, Wyoming

A new report from Innovation Ohio and the Center for American Progress, however, shows that the Buffett Rule is far from just a gimmick. According to the report, some of America’s wealthiest zip codes — ritzy communities like Fisher Island, Florida and Wyoming’s Teton Village — collectively pay lower effective tax rates than other lower-income communities, even though they are largely populated by millionaires. In seven of the wealthiest zip codes, the report found, 27 percent of residents earn 94 percent of the income — an average of $2.2 million annually — but their combined effective income and payroll tax rate is just 17.2 percent:

In zip codes with far lower incomes, however, the tax rates are higher. According to the report, 99 percent of all Ohio taxpayers live in zip codes with effective tax rates higher than 17.2 percent. The average Ohio taxpayer earned roughly $49,000 in 2008 but paid an effective tax rate of 21.5 percent, higher than the rate in any of the seven wealthy zip codes examined. Two-thirds of Ohio taxpayers live in zip codes where the average income is less than $50,000, but the tax rate is higher than 17.2 percent.

The data is similar in other states — 99 percent of Pennsylvania taxpayers, for instance, live in zip codes with effective tax rates above 17.2 percent.

The report adds to the evidence that the American tax code has grown incredibly benevolent to the richest Americans. Republicans, however, continue to urge lower- and middle-class Americans to “share some of the responsibility” of reducing the nation’s debt, all while pushing for even larger tax breaks for the wealthy.

Budget cuts proposed last year by Ohio Gov. John Kasich (R) forced cities and towns across Ohio to layoff public safety officials and close fire stations. This year, cuts in Kasich’s budget are again causing ripple effects in the area of public safety — this time by forcing one town near Cincinnati to choose between raising taxes or privatizing its fire and EMS services.

Sycamore Township lost 25 percent of its revenue, including half of its fire and EMS budget, thanks to Kasich’s budget, forcing it to choose to either levy a new tax on local residents or privatize its public safety services, Plunderbund reports:

According to a video released by Township Trustee Tom Weidman at the beginning of the process, the Township’s financial problems can be tied directly to Kasich’s budget. Local officials were shocked and amazed when Kasich and the legislature “abruptly ended” the “important source of income” from the Local Government Fund, the Tangible Personal Property Tax and the Estate Tax.

According to Plunderbund, the 0.8 percent tax the city needed to cover the lost revenue would have been one of the largest in recent memory for Ohio townships. Sycamore’s board, however, decided not to put the tax to a vote, opting instead for privatization, though Weidman claims the sell-off isn’t restricted to private companies. Still, the decision was met with backlash by local residents. “This fire department has saved my father’s life twice,” one local resident told the Cincinnati Enquirer. “You can’t put a price on a person’s life.”

And while towns like Sycamore are forced to sell off public safety, Kasich’s latest economic plan provides a break for the richest Ohioans. Under his proposed income tax cuts, the state’s top one percent would receive a quarter of the benefits. The middle class, meanwhile, wouldn’t receive enough to pay for a tank of gas.