The governorâs budget is in trouble, and he knows it. Gov. John Kasich is now actively talking up some of the controversial elements of his spending plan as many leaders in his own party continue to line up against it Gov. John Kasich doesnât often do one-on-one interviews on any subject, but he sat down to talk about the budget, which he admits is not going over well with lawmakers, including his Republican colleagues, many of whom donât like the proposal to pay for a state income tax cut in part with revenue from an expansion of the state sales tax onto some 80 services that are not taxed now.
Tax reform is always something - donât tax me, tax the guy whoâs hiding behind the tree. And so, this is just the usual, this is just the usual kind of hubbub around the issue of tax reform.
Reporter: âBut specifically the broadening of the state sales tax. Thatâs gotten some concerns there.â? Kasich: âSure.â? Reporter: âYou know, you just said it yourself â that Ohioâs taxes are too high, we need to lower them to be competitive. But when you broaden a tax and impose it on services that didnât have a tax before â isnât that a tax increase?â? Kasich: âNo, because itâs a net $1.4 billion tax cut. And hereâs the thing. About 75% of our economy now are services. Do you know you pay taxes on dry cleaning? Did you know that? And thatâs a service, okay. What the legislature has seen fit to do is whenever theyâre short money they go and tax a service that doesnât have any lobbyists, and thatâs how they plug their holes. "I want to make sure that we have a modern tax system and use it to reduce taxes to help small business and help us to be more competitive.â? But what are the budgetâs chances? Fellow Republican House Speaker Bill Batchelder, who leads a supermajority caucus 60 that includes members who were very supportive of Kasichâs first budget, is clear.
As it is, as it is submitted? That would not be possible.
Batchelder says Republicansâ concerns about the budget are no surprise to the governor. âHeâs aware of this, of course. We speak to each other often. There are a number of things there that have to change," Batchelder says. "Some of them are not very significant in terms of the quantity but theyâre important to the members of the caucus. Others are very expansive and sweeping in their nature and those would include obviously the tax, obviously Obamacare, and we still have confusion over the language involved in school support.â? The tax Batchelder refers to here is the expansion of the state sales tax, but heâs also said he and many other Republicans donât like the tax on big oil and natural gas drillers. And when the Speaker references Obamacare, heâs talking about the expansion of Medicaid to people who make up to 138 percent of the federal poverty level â a plan that Kasich has put forward even though he opposes the Affordable Care Act. But even as Kasich continues to promote the controversial elements of his budget, he remains confident.
âWhat do I think at the end of the day? Iâm hopeful weâre going to get there. But itâs always a bumpy ride. Change is very difficult.
But he wonât talk about the behind-the-scenes conversations heâs having with the Democrats he needs to pass the Medicaid expansion, or the Republicans he hopes to persuade to support that and the other elements of his budget. âI would love to talk to you about all the negotiations, but Iâm not going to.â? The budget needs to be in place by the end of June. Itâs still in a House committee, but the Speaker says heâs urging his colleagues in the Senate to start hearings of their own to make sure that deadline isnât missed.