(a) Authority to levy tax.
(1) The tax on income and the withholding tax established by this Chapter 881 are authorized by Article XVIII, Section 3 of the Ohio Constitution. The tax on income and the withholding tax established by this Chapter 881 are deemed to be levied in accordance with, and to be consistent with, the provisions and limitations of Ohio Revised Code 718 (ORC 718). This chapter is deemed to incorporate the provisions of ORC 718.
(2) The tax is an annual tax levied on the income of every person residing in or earning or receiving income in the municipal corporation, and shall be measured by municipal taxable income. The municipality shall tax income at a uniform rate. The tax is levied on municipal taxable income, as defined herein.
(3) Municipality hereby adopts and incorporates herein by reference Ohio R.C. 718.80 to 718.95 for tax years beginning on or after January 1, 2018.
(4) A taxpayer, as defined in this Chapter 881, may elect to be subject to Ohio R.C. 718.80 to 718.95 in lieu of the provisions of this chapter.
(5) "Taxpayer" has the same meaning as in Ohio R.C. 718.01, except that "taxpayer" does not include natural persons or entities subject to the tax imposed under Ohio R.C. Chapter 5745. "Taxpayer" may include receivers, assignees, or trustees in bankruptcy when such persons are required to assume the role of a taxpayer.
(b) Purposes of tax; rate. A tax of 1% to provide funds for the purposes of general municipal operations, maintenance, new equipment, extension and enlargement of municipal services and facilities and capital improvements of this municipality, there shall be, and is hereby levied, a tax on salaries, wages, commissions and other compensation, and on net profits as hereinafter provided.
(c) Allocation of funds. The funds collected under the provisions of this chapter shall be deposited in the income tax fund, and such funds collected for the tax period beginning January 1, 2003, and for an indefinite number of tax periods thereafter shall be disbursed in the following order, to-wit:
(1) Such part thereof as shall be necessary to defray all costs of collecting the taxes and the costs of administering and enforcing the provisions thereof;
(2) Not more than 50% of the net available income tax receipts received annually may be used to defray operating expenses of the municipality.
(3) At least 50% of the net available income tax receipts received annually shall be set aside and used for capital improvements for the municipality, including, but not limited to, development and construction of storm sewers and street improvements; for public buildings, parks and playgrounds; and for equipment necessary for the Police, Fire, Street, and Public Safety Departments.
(d) Statement of procedural history; state mandated changes to municipal income tax.
(1) Significant and wide-ranging amendments to Ohio R.C. Chapter 718 were enacted by Am Sub HB 5, passed by the 130th General Assembly, and signed by Governor Kasich on December 19, 2014, and H.B. 5 required municipal corporations to conform to and adopt the provisions of Ohio R.C. Chapter 718 in order to have the authority to impose, enforce, administer, and collect a municipal income tax.
(2) As mandated by H.B. 5, municipal income tax Ordinance 15-O-2839, effective January 1, 2016, comprehensively amends Chapter 880 as hereinafter set forth in accordance with the provisions of Ohio R.C. Chapter 718 to allow the municipality to continue the income tax and withholding tax administration and collection efforts on behalf of the municipality.
(Ord. 15-O-2839, passed 11-17-2015; Ord. 23-O-3198, passed 12-5-2023)