Sen. Mike Mazzei issued the following statement after Tuesday’s vote by the Senate Finance Committee approving SB 1073, a measure that would delay the reduction of the state income tax top rate from 5.25 to 5 percent and eliminates “double-dipping,” which is the itemized deduction for state and local taxes.
“Since 2004, when I first came to the Senate, we’ve reduced taxes by about $1.5 billion, thanks to a 25 percent drop in the top income tax rate, the elimination of estate taxes, the increase in the standard deduction, higher exemptions for retirement income, fewer companies subjected to the franchise tax, and the 100 percent exemption for military.
“The fact is the bench mark of $6.9 billion to lower the income tax rate from 5.25 to 5 percent was never actually achieved, because the trigger was based on the December certification, not the final certification in February the Legislature must use for writing the budget. The General Revenue Fund is now more than $1 billion below the bench mark. Furthermore, you can’t continually decrease taxes and also increase special interest tax breaks—these have ballooned to $2 billion, making the current financial situation much worse. It is unwise to lower the income tax rate in this environment.
“We are facing a shortfall of $1.3 billion. If we don’t delay this reduction and adopt other reforms, education funding, which makes up some 50 percent of the budget, will have to be cut by approximately $400 million. Other core services will also be slashed. Ultimately everyone in the state will be negatively impacted.
“As a fiscal conservative, I would much rather delay a tax cut than vote to increase taxes and start new taxes,” –Senate Finance Chairman Mike Mazzei, R-Tulsa.