RITA Model Forecasts Tax Hit from Virus Shutdowns
BRECKSVILLE, Ohio – The Regional Income Tax Agency, which handles tax services for nearly half of the state’s municipalities, has developed a new data model to forecast the impact of the coronavirus pandemic on municipal income taxes.
“With businesses ordered to close or alter operations since mid-March, the result is many individual taxpayers finding themselves furloughed, unemployed or their pay cut. We know this is going to have a direct impact on income tax revenue for all of Ohio’s municipalities, the question was to what degree,” said RITA Executive Director Don Smith in a statement.
The model, developed using data from all 300-plus governments served by RITA, will be re-evaluated monthly “in the short term and then as events warrant through the end of the year,” said Mark Taranto, manager of RITA member services.
“Every municipality has its own unique mix of businesses, so we built our model around standard NAICS codes or industry types, so each municipality could individually evaluate the effect of COVID-19 on income tax collection based on its business community,” Taranto said. “We’ve seen some municipalities use these projections in its entirety and others use it in smaller capacities, but all agree the information and insights available in this data model is helpful as they navigate these uncertain times.”
The tax forecast is available for both members and nonmembers. Nonmembers can contact RITA at 800 860 7482, while members are asked to contact the member services department for assistance with the model.
Published by The Business Journal, Youngstown, Ohio.