The Senate Finance Committee has given approval to legislation that would ultimately lower the state income tax rate from 5.25 percent to 4.75 percent. The measure was approved on a nine to three vote on Tuesday. Senate Bill 585 by Sen. Mike Mazzei, R-Tulsa, and Sen. Rick Brinkley, R-Owasso, would be fully effective in tax year 2015.
“When fully implemented, this will save hardworking Oklahoma taxpayers $250 million,” said Mazzei, Chairman of the Senate Finance Committee. “At the same time, we will be reforming ineffective and obsolete tax credits and preferences to ensure that we not only protect resources for core state services, but actually grow our economy and increase our tax base.”
SB 585 would target more than 30 obsolete tax subsidies for elimination while protecting most tax preferences for low-income individuals, senior citizens and members of the military. When fully implemented, it is estimated that 90 percent of Oklahoma taxpayers would see a tax reduction or no change at all.
“Cutting the income tax rate will give an additional boost to our state’s economy, but it is very important that we do this in a thoughtful way. That’s exactly what this legislation does,” said Brinkley, Vice-chair of Finance. “By coupling the tax reduction with tax reform, we are creating a host of benefits for the people of Oklahoma that will result in higher per capita income and a larger tax base, providing enhanced resources for education, transportation and public safety.”
SB 585 now moves to the full Senate for further consideration.