GOP Governor Hopefuls Split on Phased Cut to Income Tax

As of July 18, 2026, Republican candidates for governor are arguing less about whether to eliminate the income tax than about the speed and budget mechanics of doing so. Ohio’s Vivek Ramaswamy would start with capital gains in 2027, while Michigan candidates are divided over immediate repeal, an audit, and a $3 billion reduction in spending.

Ramaswamy has described his proposal as “the first step of a longer run path at least over the next ten years or sooner to get to zero income tax.” His plan would begin by ending taxation on capital gains, then move toward eliminating the broader levy.

Michigan’s Mike Cox wants to eliminate the state’s 4.25% rate immediately. Perry Johnson supports repeal after a statewide efficiency audit. John James supports reductions tied to cuts in what he calls wasteful government spending.

South Carolina’s Alan Wilson favors a longer transition. Pamela Evette had promised to make repeal a first-100-days priority before Wilson defeated her in the June 23, 2026, Republican runoff.

The proposals put different numbers on the cost of the same political goal. Michigan Republicans have cited an approximately $14 billion budget hole, while a January 2026 Michigan Senate Special Committee report estimated a $13.6 billion total revenue loss.

Michigan candidates tie tax relief to different spending tests

Cox, a former Michigan attorney general, says the state can eliminate its rate through spending cuts and by ending corporate subsidies. He has said a typical working household would save roughly $3,000 annually.

Cox made the case on July 15, 2026:

“The more government spends, the more likely you're going to get corruption. they’ve [other states] all eliminated the income tax. They all do better. we’re 50th out of 50.”

Johnson, a businessman and candidate for governor, also supports elimination. His first step would be a statewide efficiency audit before lawmakers commit to the change.

James, a U.S. representative and candidate for governor, has proposed an initial reduction of up to $3 billion. His targets include economic development subsidies and state contracts.

The candidates clashed over the sequencing during a May 1, 2026, debate in Auburn Hills. The debate included “shouting matches” over whether property tax relief should take precedence over eliminating the state levy.

Ohio’s proposal starts with one tax stream, then relies on growth

Ramaswamy, an entrepreneur and Republican nominee for governor, has made eliminating Ohio’s state taxes a central part of his 2026 campaign. He says the capital-gains measure could be achieved in 2027.

Ohio’s income and capital-gains taxes together bring in about $10.4 billion a year. Separate figures put Ohio’s income-tax revenue at roughly $9.8 billion to $10.46 billion annually.

Innovation Ohio said in a policy analysis dated February 18, 2026, that eliminating the tax could create a gap equal to 25% of the state’s operating revenue. The group also projected a possible $2.4 billion reduction in K-12 school funding.

Ramaswamy has argued that population growth would help offset the lost revenue. On July 15, 2026, he said a zero-tax Ohio could attract enough residents to increase the state’s population from 11 million to 15 million.

The Ohio Chamber of Commerce PAC endorsed him that day. Nonpartisan analysts have warned that eliminating the capital-gains tax alone could cost $650 million per year.

South Carolina’s budget cap would make repeal a longer process

Wilson and Evette offered voters different timelines before their runoff. Evette, the lieutenant governor, proposed making elimination a priority during her first 100 days and using technology and efficiency measures to find savings.

Wilson, the South Carolina attorney general and Republican nominee, proposed capping budget growth at inflation plus population growth. The state would return revenue collected above that cap to taxpayers, gradually reducing the levy over six to 10 years.

Wilson said in June 2026:

“We are spending 3.3% faster than we are growing as a state. revenue above that cap would be returned to taxpayers.”

South Carolina’s levy supplies 45% of the general fund. That share makes the transition’s pace a central budget question, even as both Republican contenders agreed on the end goal.

Scott Huffmon, a political scientist at Winthrop University, said on June 12, 2026, that the race had turned toward “ad hominem attacks” over character rather than policy. Wilson won the runoff on June 23 and became the Republican nominee.

Georgia has already approved the next rate reduction

Georgia’s debate begins with a schedule lawmakers approved under HB 463 in April 2026. The measure lowers the rate to 4.99% for the 2026 tax year and targets 3.99% by 2027.

Republican nominee Rick Jackson and Lt. Gov. Burt Jones are debating how to finance the final move to zero. Their discussion includes ending $3 billion in corporate tax breaks.

Democrat Keisha Lance Bottoms offered a narrower alternative on June 1, 2026. She proposed eliminating the levy only for public schoolteachers, saying a total repeal would “hurt funding for schools.”

Georgia’s existing schedule makes the state an early test of a phased cut. The remaining dispute is whether corporate incentives can provide enough savings to support the final reduction without weakening school funding.

The proposals differ most over who absorbs the transition

Michigan’s plans place the burden on spending reductions, an audit, or both. Cox argues that immediate savings for households justify immediate repeal. Johnson wants the state to identify efficiencies first. James would begin with $3 billion in cuts to wasteful spending.

Ohio’s proposal carries a broader revenue question. The state could lose billions from the combined tax streams, while Ramaswamy is counting on new residents and economic growth to expand the tax base.

South Carolina’s formula would move more slowly. Wilson’s plan would limit budget growth and return excess revenue, but full elimination could take six to 10 years. Evette’s proposal would have started with action in her first 100 days.

Georgia has already set its next benchmark. The rate is scheduled to reach 3.99% in 2027, while Republicans continue debating whether to remove corporate breaks worth $3 billion.

The next fiscal tests arrive in 2027. Ohio’s proposed capital-gains change and Georgia’s scheduled rate target would put two different versions of tax reduction into state budget debates at the same time.