During a recent government meeting, Adam Fleisher, counsel for the Money Services Roundtable, voiced strong opposition to House Bill 451, which proposes a 7% tax on funds transferred abroad by licensed money transmitters in Ohio. Fleisher argued that the legislation, aimed at generating revenue for local law enforcement, could impose significant financial burdens on both businesses and consumers.

Fleisher highlighted that the tax does not have a cap, potentially leading to substantial costs for larger transactions, such as payments made by Ohio businesses to international suppliers. He emphasized that small businesses, which often rely on money transmission services for domestic and international payments, would face increased operational costs, further complicating an already challenging business environment.

The proposed tax is expected to adversely affect Ohio residents, particularly those sending money to family or friends abroad. Fleisher noted that high-value transactions, such as tuition payments for students studying overseas, could incur fees that exceed the proposed tax credit cap of $2,000, ultimately harming consumers.

Moreover, Fleisher raised concerns about the potential negative impact on law enforcement efforts to combat money laundering. He warned that the tax could drive residents to seek unregulated channels for money transfers, undermining the oversight provided by licensed money transmitters, which are subject to strict federal regulations.

Fleisher also pointed out that the tax credit mechanism outlined in the bill is flawed, citing evidence from Oklahoma, where nearly all eligible consumers failed to claim their tax credits. He argued that the tax would disproportionately affect Ohio families and businesses, likening it to a significant tax increase.

The discussion also touched on the implications for military personnel, who often rely on money transmission services to send and receive funds while stationed abroad. Fleisher reiterated that the tax would apply equally to all Ohio residents, including military members, potentially complicating their financial transactions.

In conclusion, Fleisher urged the committee to reconsider the adoption of HB 451, emphasizing that it would create more problems than it would solve, particularly for law-abiding citizens and businesses in Ohio. The meeting underscored the complexities surrounding the proposed tax and its potential ramifications on the state's economy and law enforcement efforts.