Final Tax Cut Total Stands At $50 Million

The Oklahoma Legislature cut state taxes by $50 million in the recently concluded 1996 legislative session, according to a new study by the Senate Committee staff. The analysis was requested by Senator Dick Wilkerson, chairman of the Senate Finance Committee.

"I wanted to see what the final numbers were after the dust settled from the legislative session," said Senator Wilkerson.

"In the final analysis, I think legislators did a pretty good job of responding to the people's concerns about taxes, from property taxes to income taxes."

According to the Senate analysis, more than a dozen tax cut initiatives were enacted by the Legislature this year. They included reductions in the state income tax, the property tax, the sales tax, the estate tax, the gross production tax, the motor vehicle excise tax and motor vehicle fees for a total annual cut of $50.2 million.

In addition to those statutory changes, legislators have placed several property tax limitation amendments on the statewide ballot this fall.

The biggest tax cut --some $25.3 million-- went to private sector retirees who were granted a special income tax exemption. The lion's share of the other tax reductions were directly tied to economic development.

"We wanted to accomplish two things with our tax policy this year. We wanted to level the playing field on income tax exemptions for all our retirees in the public and private sectors. And we wanted to enact tax incentives that would further stimulate the economic growth Oklahoma has been experiencing in recent years," said Senator Wilkerson.

"We accomplished both goals, and I think our state, specifically our economy, will be in much better shape because of our success."

On the economic development front, legislators cut taxes on the energy industry and reduced the inheritance levy on family farms and businesses. They also passed tax incentives designed to spur investment in agriculture processing facilities and renewed the highly successful Quality Jobs Act.

"All of those tax cuts will help our job creation efforts. We're trying to lend a hand to the traditional industries that have created thousands of jobs over this state's lifetime and will continue to produce employment with a little help from us. At the same time, we're extending incentives to new industries through Quality Jobs and other initiatives, trying to lure them and their jobs to Oklahoma," said Senator Wilkerson.

"We think we've created one of the most competitive business environments in the country, especially when it comes to taxes."

According to the Advisory Commission on Intergovernmental Relations, Oklahoma ranks 44th in per capita tax burden. That ranking does not reflect the impact of this year's tax cuts.

The Atwood legislator noted that Oklahoma's steady economic performance put the Legislature in a strong position to enact tax cuts this year. The State Equalization Board certified an additional $287.6 million for appropriation in Fiscal Year 1997, an increase of 7.6 percent.

"It would have been a lot tougher to implement tax cuts had our economy not been booming. One of the dividends of an expanding economy is growth revenue. This year we were able to use that dividend to enact tax cuts and make a substantial investment in education, roads and public safety," said Senator Wilkerson.

"It's our hope that because of the tax cuts and other economic incentives we've enacted, the Oklahoma economy will continue to grow. Hopefully, six months from now we'll be talking about how we want to invest our next dividend."