OKLAHOMA CITY – What appeared to be Oklahoma’s last chance at an income tax break may be dead at the State Capitol.
House Bill 2032 would lower the top marginal individual income tax rate from 5.25 percent to 5 percent.
“These are the people that are developing jobs, developing corporations,” Rep. Earl Sears (R-Bartlesville) said. “They’re business people and that money that they keep there, they put it back into the business, give raises, whatever the case may be.”
Sears said income tax breaks spur the economy, creating a business-friendly environment in Oklahoma.
“Every time we’ve cut the income tax rate in Oklahoma, our budget has responded to that and it really hasn’t hurt us that bad,” he said.
Rep. Mike Brown (D-Tahlequah) disagrees.
“The ideology that says, ‘We’re going to reduce taxes and gain more jobs,’ hasn’t played out for the nine years that I’ve been here,” he said.
Brown said that lost tax revenue is needed to fund educations, roads, bridges and other infrastructure.
He helped defeat Senate Bill 585 Monday in a house subcommittee on revenue and tax; it lost by an 11-2 vote.
That bill reduced the top tax rate even more, from 5.25 percent to 4.75 percent.
It was unpopular because it also would have eliminated more than two dozen tax deductions and credits such as a child tax credit, employers child care services credit and a dry fire hydrant credit, which helps provide water to rural firefighters.
“I asked that in committee, I said, ‘If you would eliminate all these credits off this bill, you would probably have a better chance of passing this bill,'” Brown said.
HB 2032 does not include any reduction or elimination of tax credits, exemptions or deductions.
It did not get a vote in the senate finance committee Tuesday, however officials said it will be heard Wednesday in the senate rules committee.