Ohio Supreme Court to Decide If Tax Can Be Applied to Gasoline Sales

Jul 12, 2012

The Ohio Supreme Court will again have to decide whether a state tax, the commercial activities tax – also known as the CAT, that was created in 2005 can apply to a specific product.

The suit was filed by an excavating company, and it was joined by truckers, builders and contractors.  Anthony Ehler said the constitution requires money from taxes on motor vehicle owners and operators go to roads. Since CAT revenues go to schools, local governments and the state general fund, Ehler said lawmakers couldn’t put the CAT on gasoline sales.

“As applied to the privilege of selling motor vehicle fuel, those funds need to be dedicated,” says Ehler.

“The CAT is on the privilege of doing business - it’s measured by all your gross receipts, regardless of whether they’re food, widgets, motor fuel, toilet paper – doesn’t matter what you sell," says Stephen Carney arguing for the state.

The high court also heard arguments on whether revenues from a fee increase levied by the Bureau of Motor Vehicles is unconstitutional, since that money also went to purposes not related to roads.