The Oklahoma Senate has passed a measure to slash the state's personal income tax over the objections of Democrats who argue it will jeopardize critical state needs.
The Senate voted 31-15 on Tuesday for HB 3038, a bill that cuts the top rate from the current level of 5.25 percent to 4.95 percent beginning in 2013. The bill also contains triggers to further reduce the income tax every year by one-quarter of 1 percent if certain revenue growth triggers are met.
Initially, the bill slashed the top rate immediately to 2.25 percent and gradually eliminated the income tax, but Republican leaders have acknowledged such a deep cut is unrealistic.
Democrats say reducing the income tax will threaten funding for education, health care, public safety and transportation.
“Oklahoma does not have enough revenues to even begin to meet critical needs in education, health, public safety, transportation and other services our citizens depend upon. House Bill 3038 will further erode those resources. We’re 48th in the nation in the health of our citizens. If this becomes law, we’ll soon be 50th. We’re close to last when it comes to teacher pay and per pupil spending. We’ll soon be dead last in those categories, too. Supporters claim we’re going to see businesses and people flock to Oklahoma if we end the income tax. When they see Oklahoma’s schools, roads and bridges, and our public health all ranked last in the nation, this will be the last place in the nation they’ll want to come.”—Sen. Sean Burrage, D-Claremore
“The State Capitol building is crumbling around us. We don’t know how we’re going to pay for the DHS reforms that are supposed to prevent more Oklahoma children from dying in state custody. We have yet to restore funding cuts in education and other critical areas in the wake of the national recession. No one promoting the elimination of one-third of the state’s revenue is addressing these issues, except with vague claims that this will bring in more jobs, more taxpayers and that will take care of it. These are empty political promises that will leave thousands of Oklahomans without vital services and many more with a lower quality of life.”—Sen. Tom Ivester, D-Sayre
Supporters of the bill say they are confident it will lead to job growth by giving Oklahoma one of the top business climates of any state.
Republican Representative David Brunbaugh says that legislators are looking for ways to save in other departments.
"We're actually looking at everything across the board, all agencies. We're going to be looking at waste inefficiencies and non-core services to look at where we can identify savings," Brunbaugh said.