Senate proposes nixing newspaper exemption

TIFFIN — The Ohio Senate has proposed removing the sales tax exemption for newspapers. Historically, both magazines and newspapers have been exempt from sales tax. If the Senate's proposal remains in the state budget after negotiations with the House, newspapers would be taxed at 5.75%, according to the legislation proposed by the Senate. Items taxed under this section of state law are used to provide revenue to help pay for the general needs of the state, to fund Ohio schools, to support local governments, to reduce the need to rely only on property taxes and to cover the costs of running the tax system. Jeremy Speer, publisher of The Advertiser-Tribune, Sandusky Register, Norwalk Reflector, The Courier in Findlay and Review Times in Fostoria, said removing the exemption would be a disservice to readers. "Sunsetting the sales tax exemption would hurt our thousands of newspaper subscribers, and it would hurt small, local businesses who use our print and digital products as effective advertising vehicles," Speer said. He added that the move would be harmful to a small Ohio print industry. "Maintenance of the equipment that produces newspapers is our biggest expense," Speer said. "There are a miniscule number of operational presses remaining in this state, so us keeping our presses running is critical both to our publications and those of the clients we serve. Repealing the sales tax on printing equipment and materials would place more stress on an already challenged printing industry in Ohio." Earlier this month, Monica Nieporte, president and executive director of the Ohio News Media Association, testified to the Senate Finance Committee about this proposal. Nieporte told members of the committee that her organization is still analyzing the potential impact of the repeal of various sales tax exemptions. But she said she could "say confidently that these tax increases could harm Ohio businesses by increasing their advertising costs" and that the changes would "harm your constituents by creating a new cost barrier ... for access to important community news." "Subscribers who already face increased costs for everyday goods may decide they cannot pay an extra $10-15 a year for the local newspaper and many newspapers cannot afford to just eat the new sales tax," Nieporte continued. "The calculations fail to take these scenarios into consideration." She also questioned why newspapers were being singled out, saying: "Subscriptions to and purchases of magazines, digital-only blogs, and podcasts would remain exempt from the sales tax. This places newspapers at a competitive disadvantage with social media companies and our other traditional media competitors. "Your local newspapers provide critical information and stories about Ohio communities," she said. "They sponsor and support a lot of community events and even create some themselves. Your constituents in these communities will be the ones who suffer. The fallout to small businesses, rural communities and many other vulnerable groups in Ohio would be detrimental." The House and Senate have both passed their versions of the state operating appropriations. HB 96 has returned to the House for a final stretch of negotiations. The legislative bodies have until the end of the month to agree.