There’s a petition circulating in Ohio right now to eliminate property taxes altogether. Because of the possibility that this could make the ballot and even pass, conversations have exploded across the state. You can see where the petition are being circulated in the link below.
The concerns are obvious.
If property taxes disappear, what happens to schools, roads, bridges, schools, police, fire departments, libraries, snow removal, parks, and community infrastructure? These are not abstract line items. They are the basic functions of local government.
What I am not seeing enough of, however, is serious discussion about solutions.
If elimination passes, what is the backup plan?
There appears to be very little proactive conversation from the state legislature. It feels like many are simply hoping it fails. But if this reaches the November ballot and voters approve it, lawmakers would have only months to replace roughly $24 billion in annual revenue.
You should be working on alternatives right now.
I recently went live with the Ohio Housing Nerd to discuss both the problem and possible solutions. Below are several ideas worth considering.
Why This Is Happening
Let’s be clear. This petition exists because property taxes are high, rising, and unpredictable. Also, it is unethical to tax unrealized capital gains.
Homeowners feel squeezed and cheated.
You buy a home thinking you own it. Yet every year the bill climbs. Developments move in next door, assessed values rise, and suddenly people on fixed incomes are priced out of houses they’ve lived in for decades.
In some communities, property taxes are approaching mortgage-level payments.
For landlords, taxes get passed to tenants through higher rents.
For first-time buyers, tax burdens make affordability even worse.
So let me help you legislators think of some creative solutions in case we eliminate property taxes next year.
Solution 1: Leasehold vs. Freehold Models
In parts of the world, homeowners can choose between leasehold and freehold structures.
Under a leasehold system, you own the structure but lease the land from the government for a defined period. That lowers upfront costs but includes ongoing tax obligations.
Under a freehold system, you purchase both the structure and land outright. It is far more expensive upfront, but you own it free and clear without continuing property tax exposure.
Imagine a $500,000 home with ongoing property taxes versus paying significantly more upfront, perhaps $1.2 million or more, but eliminating future property taxes entirely.
That kind of structural option may deserve examination.
Solution 2: Actually Fund What We Say We’re Funding
We have been told repeatedly that:
The lottery funds schools.
Casino revenue funds schools.
Marijuana taxes fund schools.
Sin taxes fund schools.
Yet much of that revenue flows into the general fund, where allocations shift.
If the legislature allows earmarked revenues to be redirected away from the public understanding of their purpose, that erodes trust.
Reevaluate spending.
Tighten the belt.
Allocate funds transparently and for what we voted the taxes to be used for.
The reassess where the shortfalls are.
Solution 3: Graduated Sales Tax
Governor DeWine has suggested that replacing lost property tax revenue could require a sales tax approaching 20 percent. That number sounds shocking at first glance. But the real issue is not the concept of sales tax replacement. The issue is structure.
A flat 20 percent across the board would be regressive and politically dead on arrival. But a graduated consumption tax system is different.
You could structure it in tiers.
First tier: 0 percent on necessities.
Groceries. Diapers. Baby formula. Basic healthcare goods. Prescription medication. Utilities. Items that are required for daily living should not carry additional burden. If the concern is that sales tax hits lower-income Ohioans harder, then remove the tax from the goods they must buy to survive.
Second tier: moderate tax on everyday consumer goods. Say 10-12%
Basic household appliances. Standard televisions. Entry-level vehicles. Furniture. Common electronics. Items that are discretionary but still normal middle-class purchases could fall into a moderate bracket.
For example:
Cars under $35,000 taxed at a lower rate.
Televisions under 55” taxed at the standard rate.
Standard home goods taxed moderately.
Third tier: elevated tax on luxury goods. 20%+
If someone is purchasing a $120,000 luxury vehicle, a $5,000 watch, an 85-inch high-end television, or a $200 bottle of wine, they are in a different consumption bracket. A 20+ percent rate on those purchases is not the same burden as a 20+ percent rate on diapers.
Luxury vehicles over $80,000 could carry a higher rate.
High-end electronics above a certain threshold could carry a higher rate.
Luxury watches and jewelry could carry a higher rate.
Premium alcohol and specialty goods could carry a higher rate.
The idea is simple: the more discretionary and luxury-based the purchase, the higher the tax bracket.
That aligns taxation with ability to pay.
The broader principle here is this: consumption taxes can be calibrated. They do not have to be blunt instruments.
If we are talking about replacing $24 billion in annual property tax revenue, then every tool must at least be evaluated seriously.
A graduated sales tax, designed carefully, could soften the blow on working families while shifting more of the burden toward luxury consumption.
Solution 4: Tourist Sales Tax Refunds
If sales taxes are raised significantly to offset property tax revenue, one immediate concern is tourism. A higher sales tax could deter out-of-state visitors. People compare destinations. If Ohio suddenly becomes noticeably more expensive at the register, conferences, sporting events, and leisure travel could suffer.
That is where a targeted refund model comes in.
Other countries use value-added tax refund systems to encourage tourism. Visitors pay the tax at the point of sale, but they can reclaim it upon departure by proving they are not residents.
Ohio could implement something similar.
Out-of-state visitors could upload receipts, verify hotel stays, and provide proof of residency outside Ohio. After verification, a portion of the sales tax paid during their stay could be refunded.
Upload a receipt.
Verify your stay.
Receive a refund.
It prevents tourism from being discouraged by higher sticker prices.
If structured properly, this could actually incentivize tourism. “Come to Ohio. Spend here. If you’re from out of state, you get your sales tax back.”
That turns what could be a deterrent into a competitive advantage.
Solution 5: Receipt Lottery System
Taiwan faced a serious problem with cash-based underreporting. Small businesses would transact in cash, fail to issue proper receipts, and revenue would never be recorded. That meant billions in taxes left uncollected.
Their solution was brilliant.
Every government-issued receipt included a unique lottery number printed on it. Those numbers corresponded to periodic drawings. If your receipt number matched, you won cash. Sometimes it was a few dollars. Sometimes it was hundreds. Occasionally it was much more.
Consumers suddenly demanded receipts.
Businesses were forced to issue them because customers wanted their lottery chance. Reporting became automatic because the receipt itself was tied to the tax system. Compliance improved not through raids or audits, but through incentive.
I personally won several small prizes while living there. Five dollars. Ten dollars. And once, a couple hundred dollars. You simply brought the receipt to a convenience store and collected.
It created compliance through reward instead of punishment.
Ohio almost certainly leaves significant revenue on the table in cash-based transactions. A similar receipt-based incentive system could reduce underreporting and increase collected sales tax without raising rates.
Sometimes better design is more effective than higher percentages.
Solution 6: Resource Profit Sharing
Ohio is rich in natural gas. Companies extract those resources every day from beneath our soil.
The question is simple: why should private entities capture nearly all of the upside from Ohio’s natural wealth while Ohioans continue to struggle under rising property taxes?
If extraction is happening, then the people of this state should share in the benefit.
Right now, private firms drill, transport, and sell resources that originated under Ohio land. The profits largely flow to corporate balance sheets and shareholders. Meanwhile, homeowners see rising tax bills.
If natural gas development continues, a portion of those profits could be redirected into a structured revenue-sharing system. That revenue could be used to offset property tax burdens through direct credits, targeted relief for seniors, or broader reductions.
Other regions and countries treat natural resources as shared public assets, not purely private commodities. When oil or gas is extracted, the public receives a dividend or direct benefit.
Why shouldn’t Ohioans?
If resources come from our ground, then the people who live here should benefit directly. Whether through a severance tax adjustment, a royalty framework, or a public trust model, this is a revenue stream that deserves serious discussion before homeowners are asked to shoulder even more.
If they are willing to extract, then they should also be willing to share.
I promise you they will still extract if they had to share.
Solution 7: Cap Property Taxes or Tie Them to Inflation
Another model worth serious discussion is capping property taxes or limiting annual increases to inflation rather than allowing large jumps based on assessed market value increases.
Right now, people open Zillow, see their home’s estimated value jump, and then months later receive a higher property tax bill. But that value is unrealized. They did not sell the house. They did not receive cash. They may not have received a raise. They may have actually lost income due to life circumstances.
Yet they are taxed as if they experienced a windfall.
For most average homeowners, taxing unrealized capital gains feels unfair and punitive. It feels tyrannical. You are being taxed on theoretical appreciation you have never monetized.
A more stable model would be this: when you purchase a home, your property tax base is set. That base can increase modestly year over year with inflation, but it cannot spike based on speculative market swings.
If you sell the home, the property is reassessed at the new sale price, and the new owner pays property taxes based on that updated value.
If the property is transferred to children or heirs, reassessment occurs at transfer.
Other states use variations of this model. It allows long-term homeowners, especially seniors on fixed incomes, to remain in their homes without being priced out by development next door.
It aligns taxation with realized value, not theoretical value.
And most importantly, it gives people predictability. When someone buys a home, they know roughly what their tax exposure will be long term, instead of fearing sudden spikes because the neighborhood changed around them.
That model deserves serious consideration.
Solution 8: Rebalance the Corporate Tax Burden
Over the past several decades, Ohio, like much of the country, has reduced the tax burden on large corporations while expanding tax abatements and incentive packages.
The argument has always been the same: attract business, create jobs, grow the tax base.
But when corporate taxes are reduced and abatements multiply, the revenue gap does not disappear. It shifts. And more often than not, it shifts to homeowners and small business owners.
The middle class absorbs it. Property owners absorb it.
If we are serious about fairness, we need to reevaluate whether the current balance makes sense.
This does not mean punishing small businesses. It does not mean targeting local entrepreneurs.
It means examining whether large, multi-state or multinational corporations are contributing proportionately to the infrastructure, workforce, and public services that make their operations possible.
If a company benefits from Ohio’s roads, utilities, educated workforce, and public safety systems, then it should share in funding them.
We should be asking hard questions about:
The scale and duration of tax abatements.
Whether performance metrics tied to job creation are actually met.
Whether large corporations are paying effective tax rates comparable to small local operators.
Whether certain abatements should sunset automatically unless renewed with transparency.
When the burden on property owners becomes unsustainable, it is worth revisiting who has been let off the hook.
If homeowners are being taxed on unrealized appreciation while billion-dollar corporations negotiate multi-year tax forgiveness packages, the system feels upside down.
The Bigger Point
Whether or not eliminating property taxes is wise, the petition is a warning shot from the people.
People feel unheard.
They feel squeezed.
And some may vote for elimination simply to force the issue.
The legislature should not assume this will quietly fade away.
Start modeling alternatives now.
Start debating solutions now.
Start tightening spending now.
Because if this makes the ballot and passes, there will be no time left to improvise.
You’re welcome state reps for ideas
