Senate Finance Committee approves .25 tax cut

A bill to lower the state’s top income tax rate by .25 percent beginning in 2015 has cleared its first hurdle in the Senate. Sen. Kyle Loveless, R-Oklahoma City, is the principal author of Senate Bill 1246. The measure was approved on a bipartisan vote by the Senate Finance Committee on Tuesday.

“This tax reduction enables citizens to keep more of what they earn while telling the nation we are ready and open for business,” said Loveless. “But I also believe it needs to happen in a thoughtful way that ensures we can continue to fund core services like education and public safety. This bill addresses all of these issues.”

SB 1246 will reduce the state’s top income rate from the current level of 5.25 percent to five percent for tax year 2015 and beyond. The legislation also includes a reform, ending the practice of “double-dipping,” whereby a taxpayer may claim a deduction for their state income tax on their state tax return as well as on their federal return. Oklahoma is one of only six states that allows this practice.

“This is a common sense reform that will bring us into line with what other states are doing,” Loveless said. “By combining this reform with a tax reduction, we’re taking a prudent approach that will help our citizens and create jobs while still remaining sensitive to the current budget dynamics we’re facing.”

SB 1246 will now move to the full Senate for further consideration.