The Enid News and Eagle, Enid, OK

National and world

February 26, 2014

New Oklahoma income tax cut plans include triggers

OKLAHOMA CITY — Oklahoma Republican legislative leaders unveiled new proposals on Wednesday to cut the state's income tax, but not until certain levels of revenue growth are reached.

Separate House and Senate bills were released Wednesday to reduce Oklahoma's top personal income tax rate from 5.25 percent to 5 percent, a longtime but elusive goal of Republican Gov. Mary Fallin and GOP legislative leaders.

Senate President Pro Tem Brian Bingman said his measure, which will be considered Thursday in the full Senate, would cut the rate once collections to the state's main operating fund for state government return to 2013 levels.

"We made a commitment to the people of Oklahoma and we intend to keep that commitment," Bingman, R-Sapulpa, said in a statement. "This is a fiscally responsible approach that will bring tax relief to Oklahomans and encourage economic growth in our state."

Bingman's measure includes a second reduction in the rate to 4.85 percent if certain additional revenue triggers are met.

The Legislature approved a similar tax-cut bill last year that Fallin signed, but that measure also included funding for state Capitol improvements, and it was thrown out by the Oklahoma Supreme Court for violating a constitutional requirement that bills deal with just one subject.

This year, legislators have about $188 million less to spend on state programs, making passage of a tax cut more of a challenge.

A separate House proposal by state Rep. Earl Sears passed narrowly through a House committee late Wednesday to implement a similar cut from 5.25 percent to 5 percent, beginning in January 2016, if income tax collections grow enough to cover the cost.

"I'm well aware the economic environment is not good for talking about a tax cut," said Sears, R-Bartlesville. "But I feel this is a responsible tax cut that is tied to revenue growth from income tax collections."

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