Gov. Mary Fallin signs bill to eliminate double tax deduction
OKLAHOMA CITY – The Oklahoma House has reversed itself and passed legislation to eliminate what’s considered a double deduction for state income taxpayers.
The House voted 51-42 late Thursday for the Senate-passed measure and sent it to Gov. Mary Fallin to be signed into law. The House had voted 50-45 against the bill earlier Thursday.
The bill eliminates an income tax deduction that allows Oklahoma taxpayers to deduct state income tax they claim on their federal income tax return from their state return.
Supporters say the measure will save the state an estimated $87.3 million a year for state services.
The measure is among a variety of revenue bills under consideration as lawmakers work to fill a projected $1.3 billion hole in the state budget for the fiscal year that begins July 1.
Oklahoma Policy Institute Executive Director David Blatt issued the following statement regarding the passage:
….we are grateful that the Legislature has also voted to finally end the “double deduction”, a nonsensical tax break that served no public purpose and primarily benefited the wealthiest taxpayers who itemize deductions. Oklahoma Policy Institute has championed this reform for many years, and ending this tax break is a rare positive step towards a fairer tax system.
Even after these cuts to tax breaks, Oklahoma leaders have a monumental task to close a billion dollar budget shortfall without decimating critical services. Preventing this year’s income tax cut is still the most common sense option that continues to be ignored by legislative leaders. Lawmakers will not be able to adequately pay teachers or meet other serious needs of our economy and communities until they set aside the reckless tax policy that created Oklahoma’s chronic deficits.
On Tuesday, Gov. Fallin signed the bill into law.