OKLAHOMA CITY (OBV) – Three tax bills written by Speaker Charles McCall, including bills to gradually eliminate the state’s corporate income tax and personal income tax, succeeded in the Oklahoma House of Representatives this week.
“I made a promise to Oklahomans when the grocery tax passed earlier this session that the House was not done delivering tax relief to our citizens,” McCall, R-Atoka, said. “This week, the House kept that promise. State savings are at record levels, our economic outlook as a state continues to rise and now is the time to allow Oklahomans to keep more of their hard-earned money. The House believes that principle, and that is reflected by the overwhelming number of votes these bills received.”
The following three bills gained House approval:
- House Bill 2948 passed with a 78-19 vote. It phases out the corporate income tax over five years by annually reducing the tax amount by 20 percent increments beginning tax year 2024. One hundred percent of corporate tax liability will be exempt by 2028. Corporations can continue paying the tax if they so choose.
- House Bill 2949 passed 75-19. It establishes a path to eliminate the state income tax. It sets triggers to allow the personal income tax rate to be cut by .25 percent annually beginning tax year 2025. Once the income tax rate falls to 3 percent, it will be reduced further by .30 percent each year until the rate is zero and the personal income tax is completely phased out after 10 years.
- House Bill 2950 passed 74-21. It replaces the personal income tax bracket system with a 4.75 percent flat tax starting in tax year 2025. The first $13,350 of income for single filers and $27,100 for joint filers, heads of households and qualifying widowers would not be taxed. The bill also creates a path to completely eliminate the state income tax.
The legislature recently passed a grocery tax cut bill which Gov. Kevin Stitt signed into law. That legislation, House Bill 1955, was also written by McCall. Oklahoma’s state sales-tax rate, which is placed on grocery and other retail purchases, is 4.5 percent. The bill eliminates the tax on all foods that are not prepared fresh in stores.
The Board of Equalization recently certified $13.9 billion in authorized funds for the Oklahoma Legislature, including $11.1 billion in reoccurring funds and $2.8 billion in one-time funds. Stitt touted the available funds and pushed for the Senate to pass the grocery tax cut and once again called for an income tax cut.
Stitt has repeatedly pushed for income tax cuts, even calling two special sessions – one in September and one before the start of the 59th Legislature.
Senate President Pro Tempore Greg Treat has clashed with Stitt over tax cuts, having adjourned the Senate on the first day of the last two special sessions. He said both times that it would be irresponsible to pass tax cuts before knowing how much in authorized funds the legislature would have.
