The Enid News and Eagle, Enid, OK

National and world

April 11, 2013

State leaders may consider delaying income tax cut

OKLAHOMA CITY — A Senate-backed plan to delay cutting the state's top personal income tax rate until 2015 appeared to be gaining traction in the Oklahoma Legislature on Thursday, with House Speaker T.W. Shannon and a spokesman for Gov. Mary Fallin both indicating they would be open to pushing it back.

Shannon also told reporters he was willing to consider changes to some of the millions of dollars in tax credits and deductions as part of negotiations on a cut to the tax rate.

"We've certainly got a lot of reform needed in the area of tax credits," said Shannon, R-Lawton.

Shannon and Fallin had both endorsed a plan to reduce Oklahoma's top personal income tax rate from 5.25 percent to 5 percent, effective Jan. 1, but that bill was gutted in the Senate. The upper chamber replaced the plan with one to drop the top rate to 4.95 percent, effective Jan. 1, 2015, and eliminate the transferability of five separate tax credits.

Shannon said last week, when the Senate version first materialized, that he thought a delay until 2015 would be a "travesty" but indicated Thursday he would be willing to extend the effective date if it meant a deeper cut.

"If we do delay it, I wouldn't close the door on that, but it will need to be a deeper tax cut so that we don't lose the savings that we would realize, so we don't lose the economic jump that we get from cutting taxes," Shannon said.

Fallin spokesman Alex Weintz said Thursday the governor would prefer an immediate tax cut, but added that the details were negotiable.

"Her priority is to have an income tax cut bill signed into law this year," Weintz said. "In terms of the actual size of the tax cut, when it would go into effect, those are all negotiable and things we are negotiating with the House and Senate."

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