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GOP also cautious on tax cuts: Major tax changes in recent state history
(Tulsa World (OK) (KRT) Via Thomson Dialog NewsEdge) Dec. 29--OKLAHOMA CITY -- Republican leaders are not quite ready to side with Democratic Gov. Brad Henry, who says the Legislature should take a breather from making further income-tax cuts.
But the GOP lawmakers concede that a cautious approach is needed.
Budget projections show that there will be about 0.5 percent -- or $32 million -- more to fund state government next fiscal year. The Department of Corrections already is asking for $28 million to house the state's prison population, while lawmakers want to increase the roads appropriation, along with requests for more education money.
Sen. Glenn Coffee, co-president pro tem of the Senate, said Friday that record-setting tax cuts the last two years "have had a very positive impact on Oklahoma's economy."
Coffee, R-Oklahoma City, credits the cuts for Oklahoma's economy's continuing to grow slightly and ahead of the national average.
State budget analysts, however, say the gains are largely a result of high energy prices.
"Additional tax relief for Oklahomans should be part of the budget discussion during the 2008 legislative session, along with other top priorities
such as roads and bridges, public safety, and education," Coffee said.
Rep. Randy Terrill, R-Moore, who co-sponsored previous tax-cutting measures, said the fact that revenue projections show that there will be more money available proves that the tax cuts were a "wise" move.
"We have lowered tax rates by nearly 20 percent in the past three years, pumping millions of dollars into our economy," he said in a statement. "Whether or not we will be pressing for additional cuts, I don't know."
Terrill said Republicans' goal is to get the individual income-tax rate below 5 percent. For 2008, the rate is 5.5 percent.
"There obviously will be some discussion of ancillary tax issues, such as expanding the limited exemptions for clothing during the August sales-tax holiday," he said.
Rep. Chris Benge, leader of the House Appropriations and Budget Committee, said, "When we approach the subject of tax cuts or tax rates, it ought to be done in a measured and reasonable approach."
But Benge, R-Tulsa, conceded, "I think it is going to be very difficult to cut the tax rate based on our revenue projections."
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Mick Hinton (405) 528-2465
mick.hinton@tulsaworld.com
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1990: House Bill 1017, education reform and tax act, signed by Gov. Henry Bellmon. Increased sales taxes by 0.5 percent, raised individual income and corporate taxes.
1992: State Question 640 approved by voters, requiring a vote of the people before a tax cut can occur unless both houses of the Legislature have approved the cut by three-fourths of the vote.
1999: Personal income-tax rate reduced to 6.75 percent from 7 percent, provided that revenues from year to year did not decrease.
2002 : Personal income-tax rate reduced to 6.65 percent from 6.75 percent, provided that revenues from year to year did not decrease.
2006 : Personal income-tax rate reduced to 6.25 percent from 6.65 percent. State standard deduction increased to $3,000 for married couples filing joint return and $2,000 for individual filers.
2007 : Personal income-tax rate reduced to 5.65 percent from 6.25 percent. State standard deduction increased to $5,500 for married couples filing joint return and $2,750 for individual filers.
2008 : Personal income-tax rate reduced to 5.5 percent from 5.65 percent. State standard deduction increased to $6,500 for married couples filing joint return and $3,250 for individual filers.
2009 : Personal income-tax rate could drop to 5.25 percent, but preliminary revenue estimates indicate that a 4 percent growth trigger will not be met. State standard deduction increased to $8,500 for married couples filling joint returns and $4,250 for individual filers.
2010: State standard deduction to match federal standard deduction.
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