The Lead Off
- Ohio ended the 2026 fiscal year with tax collections about $1.75 billion higher than state budget officials projected.
- The Ohio Office of Budget and Management says personal income tax revenue accounted for the largest share of the surplus.
- Lawmakers are discussing how to use the additional revenue as the state prepares for future budget negotiations.
Ohio reports $1.75 billion surplus after stronger-than-expected revenue
COLUMBUS, Ohio (WOWO) Ohio ended the 2026 fiscal year with a roughly $1.75 billion surplus after tax collections came in significantly above state projections, according to a preliminary revenue report from the Ohio Office of Budget and Management.
The fiscal year ended June 30, and the reported surplus is larger than the previous year’s total, when Ohio collected about $1.04 billion more than expected according to WTOL.
State officials said revenue exceeded forecasts across major tax categories, with personal income tax collections accounting for the largest portion of the additional funds.
Tax collections exceed state projections
According to the Ohio Office of Budget and Management, personal income tax revenue came in about $1.1 billion above projections.
Other major revenue categories also exceeded expectations:
- Sales tax collections were $472 million higher than forecast.
- Commercial Activity Tax collections were $180 million above projections.
OBM Director Kimberly Murnieks said the state’s financial position remains strong.
“The budget is balanced, and the state’s financial position has never been stronger,” Murnieks said. “Each of the major tax categories ended FY 2026 solidly above forecast, and FY 2027 is now up and running and off to a great start.”
Residents discuss possible uses for surplus funds
Some Columbus residents said they would like to see additional state revenue directed toward community needs.
Tim Brack of Columbus said he would like to see more funding focused on housing.
“We walk every day at lunch just to get some exercise and stay healthy,” Brack said. “I think they should reinvest in the state and do as much as possible to help more housing affordability.”
Lynne Williams of Columbus said infrastructure investments should be considered as the state continues to attract new development.
“I know a lot of data centers, etc., businesses are going up and we’re going to need that support all the way around—roads, plumbing, electricity, you name it,” Williams said.
Lawmakers debate impact of surplus
House Finance Committee Chairman Brian Stewart, R-Ashville, said the surplus reflects the impact of recent state tax changes.
Ohio eliminated its highest income tax bracket of 3.5% and moved to a 2.75% flat income tax rate.
“We’ve always argued that if you let Ohioans keep more of their own money, they’re going to invest in this economy, they’re going to jumpstart our economic activity, and we’re seeing that now through higher collections,” Stewart said.
State Rep. David Thomas, R-Jefferson, said much of the surplus revenue has already been designated for specific uses.
“$350 million to our seniors in the homestead relief, doubling the amount of property tax credits that our seniors are getting. About 320 million to our sales tax holiday fund, giving hundreds of millions of dollars back to our taxpayers next year with an extended sales tax holiday,” Thomas said.
Thomas said lawmakers are preparing for a potentially tighter two-year budget cycle and may consider additional tax changes during future negotiations.
“I think so because we keep cutting taxes, we keep seeing more economic growth, and I think we’re going to see this in the next budget,” Thomas said.
Democrats raise concerns over spending priorities
House Minority Leader Dani Isaacsohn, D-Cincinnati, criticized how previous surplus revenue has been used.
In a statement to 10TV, Isaacsohn said additional revenue should be directed toward broader affordability issues.
“The unexpected increase in revenue is only good news if it benefits the people of Ohio. Unfortunately, the majority in the legislature always chooses to spend any additional revenue directly on more tax benefits to the richest corporations and Ohioans, ignoring the need for more affordable medicine, lower utility bills, and property tax relief. Does anyone trust that this year will be different?” Isaacsohn said.
Full financial report expected this week
The Ohio Office of Budget and Management is expected to release the state’s complete financial report Friday.
Lawmakers are expected to continue discussions about future spending priorities and budget planning as Ohio moves further into the 2027 fiscal year.
The Takeaway
- Ohio reported a preliminary $1.75 billion surplus for fiscal year 2026 after tax collections exceeded projections across several major revenue categories.
- Personal income tax collections contributed the largest share of the additional revenue, followed by higher-than-expected sales tax and Commercial Activity Tax collections.
- State officials and lawmakers are reviewing how the additional funds will affect future spending decisions, tax policy discussions and the next state budget process.
